Port partner claims it was kept in the dark on share deal

A disgruntled Northland Port Corporation business partner claims it was kept in the dark over a $24 million share deal.

The Northland Regional Council (NRC) owns 72.3 per cent of the Northland Port Corporation (NPC) and has approved in principle the sale of 19.9 per cent of its stake to the Ports of Auckland for about $24 million. However, the proposed sale has upset Port of Tauranga which is a 50-50 partner with Northland Port Corporation in Northport -- Marsden Pt's deepwater port.

Port of Tauranga was not asked if it wanted the 19.9 per cent share in the port corporation and chairman John Parker claims it was kept in the dark over the deal.

However, NRC chairman Mark Farnsworth says the deal was discussed confidentially with the Ports of Auckland (POA), and his own chief executive -- Warren MacLennan -- was not aware of the discussions until the proposal had been developed.

A letter from Mr Parker to Mr Farnsworth said that for the NRC to not talk to the Port of Tauranga about the deal had been "decidedly unfriendly".

The letter says before the deal was announced, Port of Tauranga had asked the NRC about rumours that the NRC was talking to Ports of Auckland and was advised in writing that no proposals had been put to the NRC.

"This was misleading at best," Mr Parker wrote.

However, Mr Farnsworth said Port of Tauranga was not misled -- there had been no proposals at the time Port of Tauranga inquired.

"That is just simply not right. I was having discussions with the Ports of Auckland. I was not telling my CEO -- it was in confidence with the POA.

"I'm disappointed (in Mr Parker's comments)... This is a commercial deal -- there are commercial realities here."

Mr Parker's letter also said Ports of Auckland may end up with a controlling stake in Northland Port Corporation -- despite NRC assurances to the contrary.

Mr Parker said the deal looked good on the surface.

However, 28 per cent of the port corporation was in private hands.

"If 19.9 per cent goes, and then let's say a proportion of the 28 per cent goes, you then have to appreciate that the NPC without reference to the NRC can issue another 15 per cent of shares.

"The lamb has invited the lion to dinner -- it doesn't realise the lion may not only eats its lunch, it may eat the lamb."

However, Mr Farnsworth said the NRC -- as the majority shareholder in the port corporation -- could exercise that majority to ensure the NRC retained controlling share in the port corporation.

- NORTHERN ADVOCATE (WHANGAREI)