KEY POINTS:
New Zealand First Leader Winston Peters has spoken out against a planned Canadian bid for Auckland International Airport.
The Canada Pension Plan Investment Board confirmed this morning that it wants a 49 per cent stake in the airport, but pledged to allow some New Zealand ownership.
But Mr Peters, who was strongly opposed to a previous bid by a Dubai firm, said today: "Any sale to a foreign owned company, regardless of the percentage, lessens Kiwi control of our own assets, and results in profits and other benefits from that asset ending in the back pockets of the foreign owners.
"Auckland International Airport is New Zealand's, and must remain so."
In announcing its planned bid, the Canada Pension Plan Investment Board said it would limit its stake to a maximum of 49 per cent and it would allow Manukau City Council and Auckland City Council to keep their proportion of shares in the airport.
Board senior vice-president Mark Wiseman said AIAL was an attractive asset that fitted the board's long-term investment objectives.
"Our goal is to put forward a compelling proposal to AIAL that meets the interests of all stakeholders. Specifically, we aim to deliver significant value to AIAL shareholders, while preserving ongoing substantial levels of New Zealand ownership of the airport," he said.
"We believe the structure we intend to propose will also help to facilitate future investment in the continued growth and development of AIAL. Moreover, we are committed to supporting the current management team, who we believe to be world class."
CPP said it has largely finished the "due diligence" process.
It is now considering its options on the specifics of a formal proposal.
On Friday, doubts surfaced about a $2.6 billion bid for control of AIAL being made by Dubai Aerospace Enterprise (DAE).
The Dubai company said legal proceedings filed by Air New Zealand over Auckland Airport's landing charges constituted a "prescribed occurrence" under the terms of the merger agreement.
Either party could terminate the agreement if they were unable to reach agreement within five working days.
AIAL disputed the existence of a "prescribed occurrence", and "does not consider that DAE has grounds to issue such a notice".
The CPP Investment Board is similar to the New Zealand Superannuation Fund.
It invests the funds not needed by the Canada Pension Plan to pay current benefits on behalf of 16 million Canadian contributors and beneficiaries.
As at June 30, 2007, the CPP Fund was $C120.5 billion (NZ$162.5b).
The CPP Investment Board is accountable to the Canadian Parliament and the federal and provincial finance ministers.
Significant shareholdings in AIAL include Auckland City Council, which holds 12.75 per cent, Manukau City Council with 10.05 per cent, and the New Zealand Superannuation Fund and Infratil which have a 6.2 per cent stake between them.
On Friday, AIAL shares initially dived 20c to $2.85 on the DAE news, before joining a wider market recovery to close at $3.03, down 2c.
Any CPP board proposal would involve the issue of new securities.
The board said those securities would provide enhanced returns while preserving the investment grade rating of AIAL.
- NZPA, NZ HERALD STAFF
