MELBOURNE: A bid by one of Australia’s largest pension funds to buy the Port of Melbourne is being investigated by the competition watchdog.
The Australian Competition and Consumer Commission (ACCC) has sent letters to dozens of port users asking for advice on whether industry superannuation fund IFM should be allowed to bid for the coveted asset.
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The potential problem is that the fund, which manages $67 billion, already owns a stake in the Port of Botany, Port Kembla and the Port of Brisbane.
ACCC Chairman Rod Sims said the question was whether adding the Port of Melbourne to the list could give IFM an anti-competitive level of control along the east coast. “There is an entity putting in a bid which means it would have significant shares in all east coast container ports,” Mr Sims told Fairfax Media.”This is a complex matter in the sense that you’ve got important threshold questions such as how much these ports compete against each other anyway.”
He said at this stage the ACCC did not have a view yet on whether the acquisition would be anti-competitive, but rather was seeking advice and feedback. “Before you let one company own stakes in all east coast ports you need to make sure you test the water,” he said.
IFM is bidding for the port as part of a consortium with Australian-based fund manager Macquarie Infrastructure and Real Assets, and Dutch pension fund manager APG.
Under the plan, IFM would get a 50-55 per cent stake in the port, APG a 25-30 per cent stake and Macquarie a 20 per cent stake. IFM already owns a 35 per cent stake in the NSW ports of Botany and Kembla and a 26.7 per cent state in the Port of Brisbane.
The Andrews Government is hoping to get at least $5.3 billion from the sale, with the money already earmarked to pay for Labor’s level crossing removal program.
Another bid has been submitted by Queensland investment fund QIC and Borealis Infrastructure. A consortium of Chinese investors led by a Zhejiang port group is also reportedly considering a bid. This would almost certainly be subject to a tough national security test.
Treasurer Tim Pallas said the government had always said bidders would require ACCC approval. “It is a matter for bidders to get the relevant clearance from agencies in order to participate in the transaction,” he said.
He said the transaction process remained on track for the government to announce a leaseholder before the end of 2016.
Rod Nairn, chief executive of Shipping Australia, said he would consult with shipping industry members to see if they had any concerns, though he understood that IFM did not have a controlling interest in other Australian ports.
