Protectionism, Kiwi Style

♠ Posted by Emmanuel in , at 8/07/2007 03:08:00 PM
Oh boy, here we go again. It seems that not only are the US and EU unique in preventing investment by Middle Easterners and China in local assets for "security" reasons, but also the New Zealanders as well. Remember, if you will, the particularly unenlightening Dubai Ports World deal that the US Congress annulled. In this case, the Kiwis are keen on blocking a UAE-based firm from buying Auckland International Airport. You've got to wonder why all these firms in the Emirates are keen on buying up parts of the transportation infrastructure of developed nations. Legitimate security reasons...or discrimination? You decide. From the Financial Times:

Dubai’s attempt to buy a controlling stake in New Zealand’s largest airport has sparked a political dispute after the Labour government voiced opposition to the deal.

Helen Clark, New Zealand’s prime minister, on Monday backed comments made by Phil Goff, trade minister, who had said the government agreed with local opposition to the deal for Auckland International Airport.

“Shares in the airport and the Ports of Auckland ought to remain in the public sector,” Mr Goff told New Zealand radio. “Our policy is not to sell [public shareholdings in key infrastructure utilities].” In July, Dubai Aerospace Enterprise agreed to buy 51 per cent of AIA for NZ$2.6bn (US$2bn), in a deal placing an enterprise value of NZ$5.6bn on the entire company.

The DAE bid represents a 55.9 per cent premium to the average trading price in the month before May 5, when takeover speculation began.

On Monday, DAE said: “With the right partner, AIA has a great future. However, in order for it to reach its true potential, [it] requires recapitalisation and the support of a dedicated, experienced airport operator. The DAE Airports team provides AIA with proven experience...and ensures the ongoing success of AIA, not just in New Zealand, but on the global stage.”

If New Zealand blocked the deal it would join a growing list of countries that have resisted the sale of assets by citing public interest concerns.

Last year, Dubai Ports was forced by Washington to sell back five ports it owned in the US following its acquisition of P&O, the UK container terminal and ferry operator. The sale followed opposition in Congress to an Arab country owning the assets.