Port of Melbourne to be sold for $9.7 billion

The port will be managed by a consortium that includes the Queensland Investment Corporation (QIC), the federal Future Fund, the investment group Global Infrastructure Partners (GIP) and the Canadian Pension Fund OMERS.

IFM Investors, the biggest shareholders in New South Wales’ Port Botany and Port Kembla, also submitted a bid for the Port of Melbourne lease.

The Port of Melbourne is reportedly set to be sold to a consortium led by QIC Ltd for more than $7 billion.

“This is a massive vote of confidence. every Victorian should take great pride in the price that has been paid for this asset”, Mr Andrews told reporters.

Ten per cent of the lease’s value, or around $970 million Australian, will be invested in regional and rural infrastructure projects, Andrews said.

The Port of Melbourne is Australia’s largest container, automotive and general cargo port.

The 50-year lease sale, which was significantly higher than the government’s $7 billion expectation – will be finalised on October 31.

The Australian newspaper reported that GIP was acting partly on behalf of China’s sovereign wealth fund CIC Capital (Other OTC: CIMGF – news), which it said had effectively secured 20 percent of the port.

“To say that this is a good day – that it was a pleasant surprise – I think would be an understatement”, he said.

“ALC looks forward to the Government prioritising logistics infrastructure investment from the proceeds of the sale, and from the 15% dividend to be provided to the state under the Federal Government’s Asset Recycling Scheme”.

“The VTA welcomes the Victorian Government’s lease of the Port of Melbourne”, said Peter Anderson, VTA Chief Executive. While Chinese participation in the Port of Melbourne race avoided censure from the capital, the lack of a domestic partner was widely viewed as a key reason for the elimination of Chinese investors early in the race.

Greens leader Greg Barber warned that local exporters would pay a heavy price for the privatisation.

“Now that an agreement has been reached on the long term lease of the Port, ALC encourages the State and Commonwealth Governments to prioritise infrastructure investment to the port to ensure it can meet its economic potential”, said Michael Kilgariff, ALC Managing Director.