DP World and Ngāi Tahu's unsolicited bid for Lyttelton Port rejected

Christchurch City Holdings says an unsolicited proposal from a consortium including global port operator DP World and three Ngāi Tahu rūnanga was not compelling enough to warrant further consideration.

Christchurch City Holdings (CCHL) has rejected an unsolicited proposal to lease the operations of Lyttelton Port.

The council-owned investment company said the proposal was submitted in June by the Tōnui Consortium, which includes Dubai-based port operator DP World, one of the world's largest port operators, and three Ngāi Tahu rūnanga: Ngāti Wheke, Ngāi Tūāhuriri and Te Taumutu.

CCHL chair Bryan Pearson said the proposal involved the consortium acquiring a majority interest in a long-term lease of the operating entity of Lyttelton Port Company (LPC).

However, he said CCHL had concluded the proposal did not justify further investigation.

"Our assessment of the proposal, as presented, is it does not meet the threshold for ongoing consideration and is not sufficiently compelling to warrant further detailed investigation by CCHL, or additional consultation with council given its Letter of Expectation," Pearson said.

However, Tōnui said it was disappointed by the decision and questioned whether the proposal was ever given a genuine opportunity to be assessed on its commercial merits.

The consortium said CCHL had placed significant reliance on Christchurch City Council's letter of expectation opposing a lease arrangement.

"Was there ever a genuine opportunity for an alternative partnership model to be assessed on its commercial merits, or had the policy parameters for the decision already been set?" a spokesperson said.

Tōnui rejected suggestions the proposal amounted to privatisation, saying public ownership of the port would have been retained while investment risk and operational expertise were shared.

The proposal had already attracted opposition from port unions .The consortium also said all current port workers would be retained on terms and conditions no less favourable than their present ones.

Rail and Maritime Transport Union Lyttelton branch secretary Mark Wilson said previously that DP World and its port operations in Australia had a concerning record.

"DP World in Australia are known for paying little or no Australian corporate income tax in some years, exporting profits as management fees to a parent company, reducing labour share of revenue, introducing massive fee hikes for port users, and failing to meet capital investment commitments."

In announcing its decision, CCHL said it had considered LPC's improving operational and financial performance, as well as advice from the port company about infrastructure resilience and maintaining a culture of safety and efficiency.

Pearson said CCHL retained full confidence in LPC's board and management and would continue working with the company on the port's long-term development and investment needs.