Canadian pension fund to bid for Auckland airport
03 Sep 2007
Canada Pension Plan Investment Board (CPPIB), a Canadian pension fund, said on 3 September that it intends to bid for up to 49 per cent of New Zealand's aviation hub, Auckland International Airport (AIAL), after Dubai Aviation Enterprise's (DAE's) NZ$2.6 billion dollars ($1.82 billion) for a 60-per cent stake in the airport lost ground amid stakeholder opposition to foreign control.
CPPIB said it had largely finished due diligence of Auckland International Airport Ltd (AIAL) and was considering the details of a formal proposal. The pension fund's senior vice president for private investments Mark Wiseman said that the bid would "preserve the substantial levels of New Zealand ownership of the airport". The CPPIB invests surplus funds from the Canada's state-run pension scheme, which has assets of C$120.5 billion ($114.4 billion).
The pension fund had earlier expressed interest in the airport, but key shareholders rejected its approach. Doubts surfaced about the DAE bid after the company said legal proceedings filed by Air New Zealand over Auckland Airport's landing charges could scupper the deal.
The AIAL board had approved the DAE offer, but it still requires 75 per cent approval by shareholders. It got into trouble when two city councils, which own a combined 23 per cent stake, announced their opposition to foreign control of the airport. There has also been opposition from the public, as well as from Prime Minister Helen Clark and her government.
