Port of Tauranga, in which Environment Bay of Plenty has a 55 per cent stake, reported a $37.97 million profit in its latest year.
Port of Tauranga, in which Environment Bay of Plenty has a 55 per cent stake, reported a $37.97 million profit in its latest year.
KEY POINTS:
Environment Bay of Plenty plans to raise $200 million by selling shares in the company that holds its Port of Tauranga stake but emphasised yesterday it was not a sale of the port holding itself.
The plan is to sell non-voting perpetual preference shares in Quayside Holdings, thecompany that holds the regional council's 55 per cent stake in Port of Tauranga and other investments.
The shares pay interest and will be sold to New Zealand institutions and retail investors before March.
The council unveiled the plan about three weeks ago but did not circulate it widely. It made a second announcement yesterday, making it clear it was not selling its Port of Tauranga shares.
Council chairman John Cronin said the issue had come up in debate in local elections.
He said the announcement didn't get much coverage outside the region when it was first made, even though it was one of the larger initiatives taken by a regional council in recent times.
The money raised from the share sale will be used to fund local infrastructure.
"As the shares are non-voting they will have no effect on our controlling interest in the Port of Tauranga," Cronin said.
The sale of the preference shares means council rates can be kept to a minimum.
The offer will be of up to $200 million of $1 non-voting fixed interest shares in the wholly owned subsidiary Quayside Holdings.
They will pay a quarterly fixed dividend, the amount of which will be reset every three years.
There is no indication of the rate they will pay or taxation status.
Port of Tauranga is a successful port and has been a cash cow for the council. It reported a $37.97 million profit in its latest year.
