Asset sales could net $1.4b for council
The cash-strapped Christchurch City Council could make about $1.4 billion if it sells its three biggest assets.
A review of the council's assets has suggested selling 100 per cent of Orion, Christchurch International Airport Limited and Lyttelton Port to net the billion-dollar windfall, Radio New Zealand says.
The report has not yet been released to the public.
Corporate advisory firm Cameron Partners were commissioned by the council last year to assess the value of its assets and find solutions to reduce its debt.
Advisory firm KordaMentha delivered the news earlier this month that the council was facing a cost over-run of $534 million, which could balloon if it failed to secure $1b in insurance payouts.
The Cameron Partners report says the council's debt will peak in 2019.
It says a full sale of its shares in lines company Orion would net about $602m, and selling 50.1 per cent would generate about $265m.
A full sale of the council's 75 per cent stake in Christchurch Airport would generate $557m, and selling 50.1 per cent would generate about $186m.
A full sale of the shares in the Lyttelton Port Company would generate about $231 million, and 50.1 per cent $86m.
The figures would fluctuate with changes in share value.
The report also calls for a new organisational structure that would require consolidation of the council's assets and subsidiaries.
Earthquake Recovery Minister Gerry Brownlee expressed concerns over KordaMentha's findings after its release. As a result, he commissioned financial consultants Morrison Low to provide an independent assessment of the council's financial position.
Morrison Low was meeting with KordaMentha in Auckland today, a spokesman for Brownlee said.
- The Press
Which memorial design do you like most?Related story: Christchurch earthquake memorial designs unveiled