The Southern F Locomotive Trust, of Invercargill, is not tendering to buy the historic Kingston Flyer steam train business, saying there are too many "grey areas" surrounding the assets for sale.
Spokesman Karl Barkley said the 35-year lease held by Kingston Flyer Steamtrain Ltd (KFSL) was a major sticking point.
KFSL director Phil Kerr had indicated he wanted about $1 million for the lease and would not want to work with the trust, Mr Barkley said.
"Last minute advice from our lawyers was that there were too many grey areas hanging around some major assets involved in the Flyer's tender sale," he said.
Mr Kerr refused to comment when contacted yesterday by the Otago Daily Times.
The Kingston Flyer portfolio sale, which includes the train, more than 80ha of land, and various assets, opened last month after its owner, Kingston Acquisitions Ltd (KAL), was placed in receivership by Prudential Mortgagee Nominees.
Tenders closed last Friday.
Mr Barkley said KFSL owned the diesel shunter, which was needed to move the steam locomotives.
It also owned all the tools and spare parts, plus several locked wagons and the trademark "Kingston Flyer", all of which the train's new owner would have to buy to operate the train.
Another grey area was a caveat placed on part of the track by Kingston Village Ltd, which planned to build an 800-lot subdivision in the area, Mr Barkley said.
"Our trust, with our lawyers, have done due diligence on this tender process and at present have withheld our offer as we feel all these issues should have been addressed well before the Flyer went up for tender."
The trust was still very keen to take on the train if the receiver wanted to talk over a deal, he said.
He had raised about $1500 towards the bid for the Flyer portfolio.
Kingston Village Ltd partner Ian Pillans said the caveat was placed to protect "three or four" potential track crossings for roads to its proposed subdivision.
He said no money changed hands but he had agreed to allow use of his land for sewage disposal from a proposed KAL subdivision.
KAL had resource consent for a 15-lot subdivision on some of the 80ha of land around Kingston, which is also for sale as part of the portfolio.
Former Kingston Flyer manager Russell Glendinning said KFSL had no right to the name Kingston Flyer or the logo he had designed.
"Any new operator should be able to use the name except that they could not use the trading name previously used.
"Kingston Flyer is a name going back over 80 or more years and was applied to the passenger trains running between Gore and Kingston and is not and never was a trading name," he said.
Bayleys sales consultant Barry Robertson said he would not know how many tenders had been received for the portfolio until the end of the week.
