China Merchants opposes Macquarie Bank role in Port of Newcastle

THE Chinese owners of a half-stake in the Port of Newcastle have weighed in to a corporate stoush involving the Australian arm by saying they do not want financial giant Macquarie Bank involved with the port.

As reported by Fairfax Walkley winner Adele Ferguson, the ructions involve The Infrastructure Fund, a multi-billion dollar fund owned by a group of large superannuation funds, which has stakes in various businesses, including its half-share in the Port of Newcastle.

Although The Infrastructure Fund is the ultimate owner, the NSW government’s original announcements about the privatisation described the Australian owner as Hastings Fund Management. But Hastings was actually the “external manager” of The Infrastructure Fund. The fund’s trustee was a company called Gardior, chaired by Queensland businessman Bob Lette. 

 The Infrastructure Fund dumped Hastings last year and Macquarie was one of two companies shortlisted to replace it. On April 27, Mr Lette was dumped as Gardor chairman after questioning Macquarie’s suitability, saying there were potential conflicts of interest if it was appointed.

China Merchants set out its concerns in a letter dated the same day, saying Macquarie’s appointment would “create an obstacle” to its proposal to establish a container terminal in Newcastle. China Merchants also said Macquarie’s presence could “materially affect” the port’s efforts in having competition laws amended. Macquarie declined to comment. Port of Newcastle management played down what was happening, saying: “This is a shareholder issue which has no impact on the [operations of] the Port of Newcastle.”

It said The Infrastructure Fund and China Merchants Group had a financial investment in an organisation managed “with decades of experience”.

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