KEY POINTS:
Trade Minister Phil Goff is defending his comments which have been linked to a fall in the share price of Auckland International Airport.
Shares in the company fell 7 per cent on Monday after Mr Goff was reported as saying the Government was opposed to a takeover offer
for the airport by Dubai Aerospace Enterprise Ltd.
The shares traded down 23c on Monday or 7.01 per cent at $3.05, a seven-week low.
Two Cabinet ministers have to approve the deal under foreign investment rules and some in the market have taken Mr Goff's comments to mean that the Dubai bid would be blocked.
Mr Goff and Prime Minister Helen Clark have stated that he was talking about the policy of Labour-backed councillors in Manukau and Auckland City Councils.
The two councils own a 22.8 per cent stake in what the Government sees as a strategic asset.
Mr Goff said yesterday that he was not pre-empting his colleagues but was stating Labour Party policy about continuing community ownership of the shares.
"If that has an effect on some of the speculation that might otherwise have occurred on the stock market, well that is the way it goes," Mr Goff said.
"It has nothing to do with foreign investment at all, it is purely about community ownership."
Airport shares recovered slightly to $3.19 yesterday. The Auckland City Council owns 12.8 per cent of the shares in Auckland International Airport, and Manukau City Council owns 10 per cent.
Neither council has stated its position on the deal, but local polls show most Aucklanders oppose the deal.
The deal needs the backing of 75 per cent of shareholders, and will be voted on in November after the local body elections.
New Zealand First leader Winston Peters, who is also Foreign Minister, has also voiced strong opposition to any sale.
The offer by Dubai, which is for a stake of between 51 per cent to 60 per cent, is equivalent to $3.80 a share.
It consists of $2.34 in cash and a share in the new airport company with a loan note attached, and a 7c per share special dividend.
Helen Clark said she had previously said the issue of council ownership was likely to be of keen interest in the upcoming local body election and that was what Mr Goff was referring to.
This was a different issue from that of two ministers - Trevor Mallard and David Parker - having to approve the deal under overseas investment laws.
"It comes under the category of sensitive land because of its proximity to the foreshore," the Prime Minister said.
- NZPA
