KEY POINTS:
The decision by giant container line Maersk to run the bulk of its services through Ports of Auckland puts question marks over the proposed merger with Port of Tauranga and could drive a wedge between the ports.
The Danish shipping line said yesterday that Ports of Auckland would
get the "significant" share of its port calls but Tauranga would continue to handle some of Maersk's services.
Port of Tauranga said the decision would cost it $1 million a month in revenue - or around 7 per cent of its annual revenue - and its shares tumbled 50c to close at $5.70.
The two ports announced their plan to merge to form a super-port last October in a move that would have tipped the balance of negotiating power in favour of the ports.
Currently Maersk - which controls 38 per cent of the world container market - can play one port off against another to get the best deal.
Analysts said yesterday's decision to give more business to Ports of Auckland was an attempt to destabilise the merger. The terms of the deal - that it was to be a merger of equals- were set before the Maersk decision, they said.
"You have to assume that the fact that [Ports of Auckland] has won the single biggest container deal off its main rival will make it more challenging to convince the self-appointed guardians [of Ports of Auckland] the merger is the right thing to do," said an analyst, who declined to be named.
Maersk managing director Tony Gibson said the decision was "absolutely not" an attempt to destabilise the merger. "We would never consider such a thing," he said. "Auckland is a more sustainable solution and provides us with more effective solutions for emptying containers and better use of infrastructure." It had been a very hard decision given the fact that the "Port of Tauranga have given outstanding service".
Gibson said the news of the merger proposal had caused Maersk to delay a decision on the choice of port.
"We chose to see if there was any clarity to what the port merger might bring, but frankly there was little information about what the proposal was." Customers were "crying out" for Maersk to make a decision, and needed to book slots on its vessels for January and February, said Gibson.
The line was very confident Auckland had the capacity and the capability to handle the container volumes, even if the proposed waterfront stadium on port land went ahead.
Goldman Sachs analyst Marcus Curley said the Maersk decision "by definition" meant that the Auckland Regional Holdings would have a larger shareholding in the merger.
Bosses at both ports yesterday continued to support the merger, with Ports of Auckland CEO Geoff Vazey saying the decision underscored "the importance of port rationalisation". He declined to elaborate.
Port of Tauranga chief executive Mark Cairns said it was "very disappointed" at Maersk's decision.
Mainfreight CEO Don Braid questioned the Port of Auckland's ability to handle the major increase in container traffic, considering it appeared to be running at full capacity. "The owners of the port need to give us information just what capacity the port has."
Fonterra director Jason Dale said it was a significant user of Maersk shipping in Auckland and Tauranga. "On the basis this is a sound commercial deal and will see us commercially better off, we are fine with any decision that any shipping line would make."
Shipping giant
August 2005: Maersk buys P&O Nedlloyd to create the world's largest shipping line.
October 11, 2006: Ports of Auckland and Port of Tauranga say they are merger talks.
October 12: Maersk announces the results of its port schedule review, but postpones a decision on Auckland and Tauranga.
Yesterday: Maersk says Ports of Auckland has won the bulk of its services.
