Auckland International Airport $1bn-plus selldown imminent, Jarden on the ticket

Air New Zealand aircraft at Auckland Airport. Picture: AFP

A $1bn-plus selldown out of Auckland International Airport by the Auckland Council is believed to be looming, with a deal potentially going live as early as Wednesday this week.

A further selldown has been expected in recent months after it sold an interest last year, but the understanding is that it’s imminent and broker Jarden is on the trade.

The share price has rallied strongly in the past month, as rapid interest rate cuts by the Reserve Bank of New Zealand have created hopes of an economic recovery across the Tasman.

The airport is listed in both New Zealand and Australia, and shares closed on the ASX at $7.26 with its market value at $12bn – up from $6.65 a month ago.

Already the council, which needs funds to pay for infrastructure, has offloaded a 7 per cent stake in Auckland Airport, worth $NZ800m, to pay down debt, and pension funds were pre-allocated shares.

The council now owns its shares by way of its newly formed Auckland Future Fund, which holds 11 per cent of the airport and hopes to use the funds to create portfolio diversification.

Auckland International Airport raised $NZ1.4bn in September for its capital spending program and was well supported in a deal through Jarden and Macquarie Capital.

Shares were sold at $NZ6.95, ($6.95) – a 7 per cent discount to its last close of $NZ7.48 on the NZX (they closed on the ASX at $6.95).

It comes after brokers were said to be testing any appetite on Tuesday night for a potential selldown by CIC in Goodman Group.

It has an 8.9 per cent interest in the industrial property powerhouse, and Goodman Group shares have rallied in recent months.

The entire stake is worth more than $5bn.