POLITICS has rarely been so interesting – or unnerving – for infrastructure investors.
Nanjing Night Net

While Queensland’s dramatic election saw $50 billion in potential privatisations go up in smoke, infrastructure funds have also kept one eye on Northern Territory’s on-again, off-again leadership spill in light of Port of Darwin’s planned sale.

The port, which cattle exports to Asian countries, makes about 90 per cent of its money from dry bulk exports for the metals and mining industry.

This week starts with NT chief minister – and Port of Darwin privatisation supporter – Adam Giles still in the chief minister’s chair, despite what at first appeared to be a successful challenge from Willem Westra van Holthe.

Infrastructure funds are back working on the assumption the Flagstaff Partners-run sale will go ahead, and are getting stuck into diligence materials.

A new contender is believed to be South Australian ports owner and operator Flinders Ports, owned by a handful of superannuation funds which are shareholders of the Flinders Port Holdings Pty Ltd entity.

It’s understood these shareholders, which include Infrastructure Capital Group, mechanics’ superannuation fund MTAA, Equipsuper, State Super NSW and Statewide Super, and their respective advisers such as Whitehelm Capital and AMP Capital, have decided to go to auction through the Flinders Port vehicle.

Rather than potentially bid against each other for Port of Darwin, it’s understood the group has asked Flinders Port management to take a look on their behalf.

Flinders Port is expected to line up against the likes of infrastructure fund managers Palisade Investment Partners and Deutsche Asset and Wealth Management.

Darwin Port Corporation, which runs the port, made a record $17 million profit in the 2013-14 financial year, on $58 million revenue. Earnings before interest, tax, depreciation and amortisation were $17 million, compared with $11 million a year earlier.

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