Asciano Ltd, Hastings Funds Management and Deutsche Asset & Wealth Management are each trying to form a consortium with Japanese companies such as Marubeni Corp to bid for the Port of Newcastle, an asset the New South Wales state government values at $700 million.
Marubeni Corp and other Japanese companies are seen as an ideal partners because more than half of the coal exported through Australia's oldest port goes to Japan. Coal exports represent 90 per cent of total throughput tonnage at the port.
But Japanese companies are worried that a deadline on bids for the Newcastle port before May does not give them enough time to throughly examine the asset. The NSW government wants to sell the port before May to bolster the state budget. The government wants to return to surplus by 2015.
Expressions of interest in buying the port closed last month. "Suitably qualified parties have been invited to participate in a competitive bidding process for the port," the NSW Treasurer's office said in a statement to DataRoom.
Morgan Stanley is managing the sale on behalf of the government who will use $340 million from the proceeds of the sale to invest in Newcastle. That's on top of $120 million the state has committed to the revitalisation of the city's central business district.
The use of the funds will be coordinated through the Hunter Infrastructure and Investment Fund, a capital pool that will have $690 million.
Asciano is a rail and port operator whose Patrick unit moves half of Australia's containerised freight on Australian wharves.
Hastings, a unit of Westpac Banking Corp, has invested $7.2 billion in airports, toll roads and other infrastructure while Deutsche Asset & Wealth, a unit of Deutsche Bank AG, has more than $1 trillion in invested assets.
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