CANADA/NEW ZEALAND - THE Canada Pension Plan Investment Board (CPPIB) has headed off government attempts to block foreign ownership of strategic infrastructure assets, by gaining 57.7% shareholder approval for a carefully worded bid for a minority stake in Auckland International Airport.
Shareholders in Auckland International Airport Limited (AIAL) accepted a bid from CPPIB for 39.2% of the company after the C$119.4bn (€76bn) scheme effectively agreed not to use the voting clout the shareholding gives it. These shareholders include New Zealand's public pension fund, which holds 6%.
The move accommodates protectionist legislation introduced by New Zealand government in recent weeks designed to pre-emptively block efforts by sovereign wealth funds to gain control of strategic assets. CPPIB's leadership has strenuously denied it is a sovereign wealth fund.
In a statement, CPPIB infrastructure head Graeme Bevans said the scheme had structured its bid to reflect its objective to be a minority shareholder. "It is our desire to be a cornerstone, long-term minority investor" in a way which "will assist New Zealanders in maintaining control of this important strategic asset", he said.
The scheme will voluntarily reduce its voting power, on shareholder resolutions not affecting its shares, to 24.9% and it has also agreed to limit the number of CPPIB-linked directors it will nominate to 25%.
"CPPIB will not have control over Auckland International Airport in any respect," he said.
Last week's announcement can be seen as an effort to build bridges with a previously sceptical management, as mnagers had called off talks over an earlier CPPIB bid to acquire a 49% stake which would have given it effective control.
Directors claimed the November bid would have "introduce[d] an unacceptable increase in risk" and impeded the company's growth, not least because, it claimed, the pension fund lacked development expertise. "While CPPIB would no doubt have been a committed long-term investor, they are clearly not able to bring industry or tourism experience," they said.
CPPIB holds stakes in both Brussels International Airport and Birmingham International Airport via Macquarie's European infrastructure fund.