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Mon 6 Aug 2007 11:10 AM

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NZ gov't opposes airport takeover

Trade Minister Phil Goff says government does not want to see key public utilities sold off.

New Zealand’s government has publicly voiced its opposition to the $2 billion takeover of Auckland International Airport by state-owned Dubai Aerospace Enterprise (DAE).

Trade Minister Phil Goff said today the government gave its backing to local councillors and residents who are opposed to DAE’s bid to purchase a majority stake in New Zealand’s busiest airport.

“The Government's view is very much in line with that of 80% of the Auckland public,” Goff said, quoted The New Zealand Herald.

"They don't want to see key public utilities - the airport and the ports authority, the shares in those bodies - sold off."

Manaukau and Auckland city councils hold a combined total of 22.8% of the airport’s shares, and councillors from both authorities have raised concerned over foreign control of the airport.

The sale has to be approved by 75% of the airport’s shareholders when they meet to vote on the offer in November, and opposition from the two local councils could spell disaster for DAE.

The company launched its bid last month, which received the backing of the airport’s board.

Under the offer, which values the whole of airport at $4.5 billion, a new company will be created, in which DAE will have a stake of 51 to 60%.

The deal also will need approval from country’s foreign investment regulator, the Overseas Investment Commission.

Air New Zealand has already said it intends to make a detailed submission to the commission opposing the takeover due to DAE’s close links to Dubai’s flagship carrier Emirates.

DAE chairman Sheikh Ahmed Bin Saeed Al Maktoum is also chairman of Emirates.

Air New Zealand has stated that it does not want any airline getting preferential treatment.

Analysts have speculated that if Dubai's bid is successful, it will become a secondary hub for Emirates, from which it will launch routes to the West coast of the US and to the Americas.

DAE has denied this and stated that it will not give preferential treatment to any airline.

Goff said opposition to the takeover was nothing to do with the fact that the bid was coming from Dubai.

“It's nothing to do with Dubai. Dubai is part of United Arab Emirates. They're a country with a close relationship with New Zealand,” he told Radio New Zealand, quoted AFP.

"We have no axe to grind against that country at all. Our policy is the shares in the airport and the ports of Auckland ought to remain within the public sector.”

DAE was not immediately available for comment.

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