Infratil trades sea for air

By CHRIS DANIELS

Infratil is selling down its stake in Port of Tauranga, saying it needs to free more capital for new investments such as overseas airports.

The infrastructure investor is selling a quarter of its 20 per cent stake in the port company through a share placement.

Port of Tauranga last week announced a 15.6 profit jump to $25.9 million for the year to the end of June.

The $25.7 million placement - 3.5 million shares at $7.35 each, will not include the 22c a share dividend announced last week.

Until last year Infratil owned just under 25 per cent of the port company.

Environment Bay of Plenty is the biggest owner of Port of Tauranga shares, with 55 per cent. Infratil remains the second-largest, with 15 per cent. Another 5 per cent of the company is owned by the Rotorua Charitable Trust.

Infratil manager Lloyd Morrison said most of its Port of Tauranga shares had been bought in 1994 for $1.70 each.

It was prudent to spread Infratil's capital-raising process, and now, when the port was doing so well, was a good time to sell down.

"I guess we would expect people to do very well out of this as well," he said. "People say 'why don't you hold on?' The answer is, we'll hold on to as many as we can but we do need the capital.

"Over time we hope to have investment opportunities in Europe and the US in airports, so we do need to have capital opportunities for that."

Morrison said the sell-down would help increase the liquidity of the company's shares, which are tightly held. Many smaller shareholders would now be able to buy shares in the port company.

For the next month, there will be two classes of Port of Tauranga shares available - those that carry the dividend payout with them, and the Infratil shares that will not pay out the dividend.

Port chief executive Jon Mayson said the Infratil sale would be good for the company, because more shares would now be released to the marketplace.

"If it increases liquidity then it's got to be good for the company and good for the market. We're quite comfortable with it."

Port of Tauranga last week announced a two-for-one share split, which the company also hopes will increase its liquidity.