Christchurch City pours cold water on port valuation

Christchurch City Holdings has poured cold water on an independent valuation of takeover target Lyttelton Port.

Advisers Crighton Anderson Corporate Finance had put a standalone value of $2.05-$2.35 a share on the port, with a full takeover premium of 10c a share boosting that range to $2.15-$2.45.

That was a significant step up from Christchurch City's $2.10 a share offer.

On Monday, Christchurch City described the full takeover premium as "conceptually inappropriate", as it attributed value to a strategic alliance with Hong Kong's Hutchison Port Holdings that would go ahead only if Christchurch secured 100 per cent of Lyttelton.

"The $2.10 price offered is fair as it falls within the range of $2.05 to $2.35 attributed to the shares in Lyttelton on a standalone fair value basis," Christchurch City said.

Christchurch City, the commercial arm of Christchurch City Council, launched its controversial bid for the port last month.

Owning 69 per cent of Lyttelton already, Christchurch City planned to take it over and on-sell 49 per cent of the port to Hutchison.

Early this month, Port Otago put an obstacle in the path of that plan when it bought 10.1 per cent of the Lyttelton shares, standing in the market with an offer of $2.35 a share.

Lyttelton's directors unanimously rejected the Christchurch offer.

Christchurch said it was considering its options, but ruled out an alliance with anyone but Hutchison.

Shares in Lyttelton Port closed up 2c at $2.21 on Monday.

- NZPA