On Friday afternoon, just a few hours after the Cameron Partners presentation, Christchurch City Holdings launched a takeover bid for the Lyttelton Port Company. Some people wonder how they could afford it. Raf Manji says CCHL has its own money, which is not relevant to the Councils position. Legally, that is quite correct. CCHL is a limited liability company, so it is a separate entity from the council. The Local Government Funding Agency doesnt include CCHLs debt when considering whether the council is acting in accordance with its banking covenants. However, the Cameron Partners figures for the councils potential debt position do include CCHLs debt. Its possible the reason someone gave a higher debt figure than the one in CPs report might have been that they were aware of the planned takeover and had added the cost of that into the numbers. If you dont count CCHL debt, then the figure quoted by Cameron Partners is about 100 million too high. If you do, its too low, because of the cost of the takeover of LPC.
Posted on: Tue, 05 Aug 2014 22:43:34 +0000
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