Senior city councillors promote Hamilton airport share sale

Tuesday, 14 May 2024

Hamilton airport has been looking to bring back international flights but needs to upgrade facilities first.

Two senior Hamilton councillors are pushing for an airport share sell-down and international flights to and from the city.

Councillors had already asked Waikato Regional Airport Limited to aim for bigger dividends and to beef up its commitment to attracting international flights at a city economic development committee hui in March.

Hamilton City Council has a 50% shareholding in the airport, jointly owned with four other local councils.

While Waikato Regional Airport Limited (WRAL) hasn’t changed its dividends position - councils have accepted its “constrained cash position” - the company is being more explicit about attracting and preparing for international services.

Councillor Geoff Taylor says he plans to more actively advocate for Hamilton to sell down its 50% shareholding in the airport company, to raise cash and shake up the way it operates.

That’s all in a revised draft statement of intent for 2024-25, received by Hamilton City Council’s committee last Thursday.

However, councillor Geoff Taylor declared he was still frustrated at the “bureaucracy” surrounding the airport, which had $234 million in shareholder equity as at June 2023.

He planned to more actively advocate for a Hamilton shareholding sell-down to raise much-needed funds “and it may just inject some imagination, ambition into our shareholding arrangements”.

Economic development committee chairperson Ewan Wilson thinks a share sale could bring in a “commercial player” with “vision”.

Committee chairperson Ewan Wilson agreed a share sale could help remedy the allegedly bureaucratic way the airport was run.

“We need a commercial player sitting around that airport [board] table saying ‘here’s our vision’.”

Following the March meeting a subsequent hui of shareholding councils decided it was not in the best interests of the company or shareholders to force a new approach on dividends given WRAL’s “constrained cash position”.

Hamilton airport says it’s working with state agencies on re-establishing border controls to handle international flights.

But it agreed to WRAL revising wording on attracting international air services.

It followed concern a lack of border agency facilities at the airport meant the company hadn’t been able to respond quickly to recent trans-Tasman interest in renewing international flights.

The revised draft says a new objective is to future proof Hamilton as an international airport, continue “active engagement” with airlines wanting to use the city for international flights, and ensure the needed infrastructure and border agencies were in place to support such services.

Taylor thanked WRAL for the revisions but said Hamilton’s 50% stake was a “huge asset” the city couldn’t do a lot with at present because making changes was dependent on other councils.

Airport company director Margaret Devlin said in March that the company was close to securing a “good outcome” with an international airline.

“No disrespect to our shareholders but I sometimes do sense a passivity…in their approach to the airport.”

Selling a slice of the city’s holding may therefore have no downside, Taylor said.

On the airport’s current lack of infrastructure and services to support international flights, Wilson said: “An international airline flying into this city will pump tens of millions of dollars of real economic development”.

Following the missed opportunity “now we’re chasing our tail…to try to catch up”.

But, in March, airport director Magaret Devlin said confidential discussions on accessing Hamilton were continuing and the company was close to securing a good outcome with one airline.

Airport operations manager Ben Langley told councillors then that WRAL was working with state agencies on the idea of re-establishing border controls.

A “best case scenario” was this could take a year but agencies would like two years.

Langley acknowledged the timeframes could constrain airlines wanting to make fast decisions - WRAL wanted to hasten progress and the Government had appointed a project manager.