Extraordinary Meeting of the Hawke's Bay Regional Council

 

 

Date:                 Wednesday 13 February 2019

Time:                1pm

Venue:

Council Chamber

Hawke's Bay Regional Council

159 Dalton Street

NAPIER

 

Agenda

 

Item       Subject                                                                                                                  Page

 

1.         Welcome/Apologies/Notices 

2.         Conflict of Interest Declarations  

3.         Confirmation of Minutes of the Regional Council Meeting held on 30 January 2019

Decision Itemsp

4.         Additional Council Controlled Organisation to Support IPO Transaction Statement of Proposal for Consultation                                                                                              3  

Decision Items (Public Excluded)

5.         Confirmation of Public Excluded Minutes of the Regional Council Meeting held on 30 January 2019                                                                                                               11

 


HAWKE’S BAY REGIONAL COUNCIL

Wednesday 13 February 2019

Subject: Additional Council Controlled Organisation to Support IPO Transaction Statement of Proposal for Consultation

 

Reason for Report

1.      This report asks Council to adopt the attached Statement of Proposal to establish a new Council Controlled Organisation (CCO) to provide an efficient and effective structure to facilitate a potential minority share issue of Port of Napier Limited (Napier Port or Port).

2.      The Council is required under section 56 of the Local Government Act 2002 (LGA) to undertake consultation before establishing a CCO. 

3.      The consultation document has been subject to a legal and tax review to confirm the document is fit for purpose.

Background

4.      The need for this consultation has arisen from the Regional Council’s ‘in principle’ decision on 19 December 2018 to progress and refine an IPO transaction.  Part of designing an IPO transaction is to determine the optimal structure to enable the most efficient offering of shares and the ongoing operation of a publicly-listed company.

Scope of the Decision

5.      The Council’s preferred option in the Statement of Proposal is to establish a new CCO, provisionally named “HoldCo”, to own shares in Napier Port and to act as the listed entity for the potential IPO.

6.      The Council agreed its preferred option at its meeting on 30 January 2019, following advice from PWC and Bell Gully on the range of options for the legal and tax structures available. 

7.      The details of the HoldCo option are compared in the Statement of Proposal against the status quo option, which is for both Hawke’s Bay Regional Investment Company Ltd (HBRIC) and Napier Port to sell shares.

8.      As a result of feedback received during the consultation, the Council may change its preferred option. 

Consultation Process

9.      As noted above, the establishment of a CCO requires consultation under section 56 of the LGA. The Council has discretion under this section of the LGA to decide the form the consultation takes. 

10.    The key dates for the consultation are:

18 February 2019           Consultation opens

1 March 2019                  Consultation closes

13 March 2019 (1pm)     Set aside for people to present their views in person

27 March 2019                Decision made by the Regional Council  

11.    The Statement of Proposal will be posted on the council’s website as soon as practicable after it is adopted. The consultation will be advertised in Hawke’s Bay Today, posted to social media and emailed to interested and affected parties via the council’s “Stakeholder Update” and those who have registered online for updates in relation to the IPO transaction.

12.    The Council will invite submissions and feedback over a period of two weeks. Submissions will then be collated, heard and the final decision to establish a CCO made by the end of March 2019. This timing aligns with the adoption of the LTP Amendment as already consulted upon.

13.    Legal advice received considers that this relatively ‘streamlined’ consultation complies with the LGA consultation requirements in light of:

13.1.    the previous consultation (Our Port – Have your say) undertaken, particularly in relation to the assumption “The Regional Council retains the ability to establish the appropriate structures to manage the transaction and the Regional Council’s continued ownership position in the Port, such as the possibility of creating new holding entities or corporate structures as required

13.2.    the nature of the decision (as a procedural step), and

13.3.    the Council’s discretion under the LGA.

Decision Making Process

14.    Council is required to make every decision in accordance with the requirements of the Local Government Act 2002 (the LGA). Staff have assessed the requirements in relation to this item and have concluded:

14.1.   The decision does not significantly alter the service provision or affect a strategic asset.

14.2.   The use of the special consultative procedure is not prescribed by legislation but consultation is required under section 56 of the LGA. 

14.3.   The decision is not inconsistent with an existing policy or plan.

 

Recommendations

That Hawke’s Bay Regional Council:

1.      Receives and notes the “Additional Council Controlled Organisation to Support IPO Transaction Statement of Proposal for Consultation” staff report.

2.      Agrees that the decisions to be made are in accordance with section 56 and 82 of the Local Government Act.

3.      Agrees to the public consultation process as described above.

4.      Adopts the Statement of Proposal as attached, for public consultation.

 

Authored by:

Drew Broadley

Community Engagement and Communications Manager

Desiree Cull

Strategy and Projects Leader

Approved by:

Jessica Ellerm

Group Manager Corporate Services

James Palmer

Chief Executive

 

Attachment/s

1

Statement of proposal to establish HoldCo

 

 

  


Statement of proposal to establish HoldCo

Attachment 1

 

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HAWKE’S BAY REGIONAL COUNCIL

Wednesday 13 February 2019

SUBJECT:

That the Council excludes the public from this section of the meeting being Confirmation of Public Excluded Minutes Agenda Item 5 with the general subject of the item to be considered while the public is excluded; the reasons for passing the resolution and the specific grounds under Section 48 (1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution being:

 

 

 

GENERAL SUBJECT OF THE ITEM TO BE CONSIDERED

REASON FOR PASSING THIS RESOLUTION

GROUNDS UNDER SECTION 48(1) FOR THE PASSING OF THE RESOLUTION

Port Development Project Executive Steering Committee Update

7(2)(b)(ii) That the public conduct of this agenda item would be likely to result in the disclosure of information where the withholding of that information is necessary to protect information which otherwise would be likely unreasonably to prejudice the commercial position of the person who supplied or who is the subject of the information

7(2)(j) That the public conduct of this agenda item would be likely to result in the disclosure of information where the withholding of the information is necessary to prevent the disclosure or use of official information for improper gain or improper advantage

The Council is specified, in the First Schedule to this Act, as a body to which the Act applies.

Napier Port Director Appointments

7(2)(a) That the public conduct of this agenda item would be likely to result in the disclosure of information where the withholding of the information is necessary to protect the privacy of natural persons

The Council is specified, in the First Schedule to this Act, as a body to which the Act applies.

 

 

 

Authored by:

Leeanne Hooper

Principal Advisor Governance

 

Approved by:

James Palmer

Chief Executive