Port Otago - which holds a 15.5% stake in listed Lyttelton
Port of Christchurch - is becoming increasingly frustrated by
the lack of financial rebuilding information from the port
The contentious Port Otago stake in its northern competitor
cost it $2.30 per share to acquire and is valued at $2 per
share, but Port Otago believes the true value is about $3 per
Port Otago's stake in LPC was yesterday valued at $34.8
The 15.5% holding represents a blocking stake to any takeover
offer. That was the case when Port Otago spent $37 million
grabbing the stake in March 2006, stopping majority
shareholder Christchurch City Council from selling LPC to an
international port manager at the time.
Port Otago chairman Dave Faulkner updated Otago Regional
Council councillors on its LPC stake yesterday, saying ''the
big question is the value of Lyttelton''.
As a shareholder, Mr Faulkner had attended LPC's general
meeting and publicly asked for more information.
''We were told `we don't know'. After two years you would
expect they would have a [estimated] range,'' Mr Faulkner
''It's important for us as a shareholders to know the
difference between [rebuilding] costs and insurance
[liabilities] for our outlook,'' Mr Faulkner said.
Councillor Gerry Eckhoff queried holding the LPC stake,
asking if it was seen as ''hostile'' by LPC and therefore LPC
was ''not concerned about delivering a dividend?''.
''Yes. At the time [of acquisition] Lyttelton very much
considered that hostile,'' he said.
However, Mr Faulkner noted it was not surprising LPC would
want to keep cash for itself, given the extent of
infrastructure spending it was embarking on.
Port Otago has always maintained its stake was a long-term
holding, and given its lower-than-purchase price value at
present, Mr Faulkner confirmed the stake would be held as
''There's not a queue of buyers out there,'' he said, because
of the extent of work which had yet to be undertaken.