Port Otago will maintain its 15.5% stake in rival Lyttelton Port of Christchurch (LPC) but has no plans to reignite merger proposals, new chairman Dave Faulkner said yesterday.
During his inaugural presentation of Port Otago's six-monthly report yesterday to 100% owner the Otago Regional Council, Mr Faulkner said Port Otago would "maintain a long-term view" to retaining its LPC stake.
LPC is listed on the stock exchange, being 78.7% owned by the Christchurch City Council and 15.48% by Port Otago.
Port Otago took a controlling and contentious $37 million, 15.5% blocking stake in LPC in March 2006, essentially gatecrashing and stopping a proposed takeover and delisting of the company so owner Christchurch City Council could bring in an international management company to oversee the then ailing port.
Following the September earthquake last year, LPC quit the negotiating table as it dealt with issues of rebuilding and redevelopment, and following the latest quake has announced it will not be paying shareholders an interim dividend.
To date, Port Otago has received about $3.7 million in dividends from LPC.
After the meeting, Mr Faulkner said despite more infrastructure damage and LPC's dividend suspension, he was confident the stake was worth maintaining, as LPC had strong cashflows and much of the repair work would be covered by insurance and dividends would resume.
Mr Faulkner's predecessor, John Gilks, was a strong proponent of the merger proposal, but Mr Faulkner allocates it to the recent past with no intentions of reopening negotiations.
"No, we have been there done that ... it's off the agenda," he said.
ORC councillors asked if Port Otago was gaining any special insight into LPC operations, but both Mr Faulkner and chief executive Geoff Plunket said "No", other than dividends and information which is delivered to shareholders.
