KEY POINTS:
The New Zealand Superannuation Fund and infrastructure investor Infratil have further increased their combined stake in Auckland Airport, a notice to the NZX yesterday showed.
The growing stake will make it even more difficult for a foreign buyer to get control of the airport without dealing directly with Infratil managing director Lloyd Morrison.
A substantial security notice issued to the stock exchange shows that between them the pair now have a stake of almost 8 per cent.
They have increased their stake by 1.8 per cent - or about 22 million shares - in the six days since the airport board pulled the plug on sale talks with the Canada Pension Plan Investment Board (CPPIB).
The NZ Super Fund uses private institutions to buy and hold shares on its behalf. The increase in its holding was declared yesterday and showed it now owns a 5.07 per cent stake - held on its behalf by Barclays Global Investors, AMP Capital Investors, Brook Asset Management, Smartshares and Morrison & Co. (the investment company of Lloyd Morrison, who also controls Wellington-based Infratil).
Morrison and Infratil declared a 6.25 per cent stake on Friday, jointly held with NZ Super. The shares which Morrison and Co. holds for NZ Super were declared in both notices.
Excluding that overlap, the combined stake of the two parties is now 7.79 per cent.
With the Canada Pension Plan proposal - which valued the company at up to $3.90 a share - off the table, the share price dropped 20 per cent last Wednesday.
But that has since been proppedup by the buying activity of Infratil and other investment funds buyingon behalf of the NZ Super Fund.
Heavy trading volumes were recorded late last week and on Monday this week.
The volumes were light yesterday as the shares rose 2c to close at $2.91.
A 10 per cent stake is considered strategically significant because it is enough to block takeover offers for the whole company.
But the stake held by the pair is already strategically important, given that 23 per cent of the airport isowned by city councils which have declared they will not sell down their positions.
Foreign bids for the airport by Dubai Aerospace and CPPIB were both scheme of arrangement proposals which required the support of 75 per cent of shareholders.
The NZ Superannuation Fund invests Government money with a mandate to partially provide for the future cost of funding superannuation payments.
The Crown plans to allocate around $2 billion a year to the fund over the next 20 years.
The fund's mandate is to invest the money in a way that maximises returns without undue risk - that makes infrastructure assets ideal investment targets.
Auckland Airport yesterday confirmed it will hold its annual general meeting on Tuesday, November 20, at the Ellerslie Events Centre in Auckland.
