A trading halt on Auckland Airport shares sparked by a reference by Auckland mayor Wayne Brown to a significant public cash raising has been lifted.
It turned out to be one of the shortest trading halts in NZX history – it was lifted just over an hour after it was put in place.
After the NZX’s announcement of the trading halt, Brown said he was just “speculating” about Auckland Airport fundraising.
In an urgent statement, a spokesperson for him said: “The mayor is not in possession of any information not available to the market”.
Brown had told a council meeting Auckland Airport was about to start fundraising for a second domestic airport terminal.
“Dilution’s almost inevitable – they’re about to go to a major raising to fund a new domestic airport and we will not be contributing to that so our 18 percent will soon become about 11 or 10 [percent] so at that stage it becomes less and less and less strategic,” Brown told the meeting.
NZX immediately placed the Auckland Airport shares on halt pending any announcement by the airport.
Auckland Airport promptly denied any intention to raise money for a new terminal through a share sale, as suggested by Brown.
It said it was planning to borrow to fund a new terminal when it was needed.
Its priority was the creation of a combined domestic and international terminal, which was part of an expansion of the existing international terminal, it said.
Immediately after the airport clarified its position, NZX lifted the trading halt.
Investment expert Brad Gordon said Brown’s comment was more politically motivated than reflective of any insider’s knowledge.
“I think it is political positioning on the Auckland Airport stake highlighting to the council that if they retain the stake as is, there may be a potential liability via a capital raise to Auckland shareholders or dilution down the track.
“So I think he is just laying out the case to the council.”