BUSINESS

Invercargill City Holdings Ltd takes $3 million worth of shares

Friday 21 December 2012, 2:00PM
By Invercargill City Council
350 views


INVERCARGILL

Invercargill Airport Ltd has issued $3 million worth of new share capital to fund the maintenance programme. The shares were offered to the existing shareholders. The Crown elected not to take up any shares in the subscription.  While the Crown acknowledged that the Airport had an important role to play within Invercargill City’s wider regional economic development strategies, the Crown was under significant capital restraint and was, unfortunately, not in a position to support the expenditure at this time.

The Directors of Invercargill City Holdings Ltd (the Invercargill City Council’s umbrella holding company) chose to take up the additional shares that were declined by the Crown, as they viewed the Airport as being vital to the city’s infrastructure. This brings Invercargill City Holdings Ltd shareholding in Invercargill Airport Ltd to 97.19%. The Crown will remain a shareholder and will retain a 2.81% shareholding.

Airport Chairman Joe O’Connell said that the shares were issued because the Airport needed new capital to fund overlay works on the apron and taxiway.  These maintenance works are routinely required approximately every 12 years and are scheduled to be completed early in the New Year.

Invercargill Mayor Tim Shadbolt said that the increased shareholding was a good thing.  “The Airport is a strategic asset for the city and it is vital that the community maintains it in good condition.”

At the December meeting of the Council, Councillors voted unanimously in agreement with Holdco’s proposal to increase its shareholding in the Airport.