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Privatisation of Port of Melbourne, Australia

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In its Budget on 6 May 2014, the State Government of Victoria confirmed that it would privatise the Port of Melbourne in Australia. We expect significant investor interest. This briefing note sets out …

In its Budget on 6 May 2014, the State Government of Victoria confirmed that it would privatise the Port of Melbourne in Australia. We expect significant investor interest. This briefing note sets out our understanding of the proposed privatisation.

Contents:
- Overview of the Port of Melbourne
- Timetable for privatisation
- Political context to the privatisation
- Scoping study and differences in approach
- Transaction structure
- Likely sale price
- Preliminary issues
- Expansion of the Port and development of a second port
- Regulatory clearances for bidders
- State-based regulation of Port charges
- Commonwealth-based regulation of Port charges
- Other issues to be considered in due diligence
- Our team

Published in: Law, Business

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  • 1. Privatisation of Port of Melbourne, Australia In May 2014, the State Government of Victoria confirmed that it would privatise the Port of Melbourne in Australia. We expect significant investor interest. This briefing note sets out our understanding of the proposed privatisation. We will update this briefing note as more information becomes available. Overview of the Port The Port of Melbourne is one of the top four container ports in the Southern Hemisphere. The Port is Australia’s largest and most important maritime trade hub for container, automotive and general cargo. The Port supports the State of Victoria and south-eastern Australia. The Port of Melbourne handles around 37% of Australia’s container trade, amounting to some 2.51 million containers (TEU) per year in the year to June 2013. During the 2012/13 financial year, the Port experienced some 3,200 commercial ship visits, throughput of 85.6 million revenue tonnes (35 million mass tonnes) and handling of over 370,000 automotive units. As well as containers, motor vehicles and general cargo, the Port handles liquid bulk products (such as crude oil imports and petroleum product exports), and dry bulk products (including cement, gypsum and sugar as imports, and wheat, canola and barley as exports). The Port comprises 34 commercial berths over 7 kilometres of quayline. Timetable for privatisation A scoping study for the privatisation of the Port of Melbourne was completed by KPMG in early 2014. As at July 2015, the Government is in the process of appointing financial and legal advisors. An expression of interest process is expected to commence in early 2015. Briefing 18 July 2014
  • 2. Privatisation of Port of Melbourne, Australia 02 Norton Rose Fulbright Political context to the privatisation Since the late 1990s, Australia has sought to privatise port infrastructure in order to reduce government debt and improve port performance and productivity. In 1996, the State of Victoria privatised two of its major ports, but abandoned plans to privatise the Port of Melbourne following opposition by port users. In recent years, Australia has experienced a series of port privatisations. The Port of Brisbane was privatised in 2010, followed by Port Botany and Port Kembla in 2013, and Port Newcastle in 2014. The privatisations of a number of other ports are also proposed. The Port of Melbourne remains one of the few major ports on the east coast of Australia still owned by a State government. The State of Victoria is scheduled to have an election on 29 November 2014. The Labor Party (currently in opposition) has stated that it will also privatise the Port of Melbourne if it is elected. Privatisation should therefore occur irrespective of the outcome of the State election. However, the two major political parties, the incumbent Liberal/National Coalition (in government) and the Australian Labor Party (in opposition) currently have different views on the optimal privatisation structure. Privatisation proposed by the Coalition The Port of Melbourne is approaching full capacity. While a current expansion is addressing immediate capacity constraints, both political parties recognise that a second port is required. The key point of difference between the political parties involves the location of that second port and the long-term role of the Port of Melbourne. Under the Coalition, the Port of Hastings (a natural deep water port) is the favoured second port. The successful bidder could be given an option to participate in the development of the Port of Hastings. The revenue from the sale of the Port of Melbourne would be used in part to assist that development. The Victorian Treasurer has commented that tying the sale of the Port of Melbourne to expansion of the Port of Hastings should create a more attractive proposition for bidders, although (as discussed below) the Australian Competition and Consumer Commission (ACCC) has expressed concern around any such optionality. The Coalition would intend to shift the long-term focus of port activities away from the Port of Melbourne to the Port of Hastings, thereby releasing valuable land currently held by the Port of Melbourne to facilitate the expansion of the Melbourne central business district. A lease of 40 years, rather than 99 years, would be granted over the Port of Melbourne with an intention to decommission operations at the Port at the end of this period. Privatisation proposed by the Labor Party The Labor Party favours development of a second container port at Bay West, between Geelong’s Little River and Point Wilson. The Labor Party argues that a port located at Bay West would be a more economic option than the expansion of the Port of Hastings and would avoid potential constraints on berth capacity and logistics. The privatisation contemplated by the Labor Party would involve the grant of a 99 year lease over the Port of Melbourne. The grant of a 99 year lease implies that the Port of Melbourne would continue to operate over that period and hence land would not be released from the Port for the expansion of the Melbourne central business district. It has not yet been determined whether a bidder would also be given any rights in relation to Bay West. In practice, the key difference between the two political parties is therefore the duration of the lease and the nature of any optionality in relation to the development of the second port.
  • 3. Privatisation of Port of Melbourne, Australia 03 Norton Rose Fulbright Transaction structure The Port of Melbourne is currently operated by the Port of Melbourne Corporation (PMC), a State-owned statutory corporation. The privatisation is most likely to follow the privatisation structures used for the recent privatisations of the Port of Brisbane, Port Botany, Port Kembla and Port Newcastle in Australia: • First, the Victorian Government would enact implementing legislation. This legislation would amend relevant State legislation to facilitate and authorise the privatisation as well as effecting any changes necessary to implement the desired post-privatisation regulatory framework. • Second, the relevant State assets to be privatised would be transferred by the Victorian Government into a State-owned Ministerial holding corporation (HoldCo), a State entity established by the implementing legislation to hold Victorian port assets to be leased to the private sector. • Third, a Project Company would be created to enter into a 40 year lease with HoldCo. The lease would provide for the lease of port land and associated infrastructure, including wharves, buildings, terminals and roads (Port Assets). HoldCo would retain the underlying freehold ownership of land, but would have no control of the operation of the assets in its role as lessor. In addition: o The lease would confer rights to use the relevant assets and to retain the economic benefits of charges imposed. The lease may also impose a range of performance and compliance obligations. o HoldCo would retain step-in rights and the ability to terminate the lease if the Project Company were to breach key obligations, following a predetermined ‘cure period’. • Fourth, existing key contracts would be novated to the Project Company. Some employees would also transfer to the Project Company, supported by various Government commitments to preserve employee entitlements. The privatisation would subsequently occur via the sale of 100 per cent of the shares in the Project Company by the Victorian Government to an investor consortium. In this manner, investors would be offered a pre-packaged deal without any involvement in the negotiation of the 40 year lease. This transaction structure is illustrated in the following simplified diagram:
  • 4. Privatisation of Port of Melbourne, Australia 04 Norton Rose Fulbright Process for the transaction We anticipate that the Victorian Government will adopt a process for the transaction that is similar to that followed in New South Wales and Queensland for the recent privatisations of their respective ports. Under this approach, the Victorian Government would prepare a detailed and confidential information memorandum (IM) containing all the information that bidders will require to evaluate the asset. Once the Port of Melbourne was ready for sale, the IM would be supplemented by a vendor due diligence report that addressed key issues. Following a shortlisting process, the shortlisted bidders would be given access to management presentations and an extensive data room, thereby enabling a full due diligence to occur. The shortlisted bidders would each be issued with pro forma contract documents at the same time they were granted access to the data room. The contracts would be negotiated independently with each bidder, hence providing scope for bidders to include various provisions (such as indemnities and undertakings) to address any concerns. The shortlisted bidders would be invited to submit their bids in conjunction with the negotiated contracts. The winning bid would normally be the highest bid, bearing in mind any contractual concessions. Likely sale price for a 40 year lease As at July 2014, the Victorian Government has not publicly identified a budgeted sales price for the 40 year lease, although the State budget recognises its effect. The media have speculated on a figure of AUD 5 billion. Different port leases have different cost, revenue, risk and growth characteristics that impact upon their valuations. Accordingly, it is difficult to make meaningful comparisons between the sales prices achieved for different ports. Ultimately, the price for the Port would be determined by bidders using a discounted cash flow (DCF) analysis subject to a range of assumptions, many of which are unique to the Port. Assuming a 10% WACC, the valuation difference between a 40 year lease and a 99 year lease under a DCF analysis may not be significant (< 1%). Bearing these important caveats in mind, some guidance as to the likely sales price for the Port of Melbourne is provided by the sale prices achieved for 99 year leases in the context of other recent port privatisations: • In 2013, Port Botany was privatised for AUD 4.31 billion and Port Kembla for AUD 0.76 billion under respective 99 year leases. The NSW Government indicated that the aggregate figure of AUD 5.07 billion was some 25 times the annual earnings (EBITDA) from those ports. The budgeted sales price was AUD 3 billion. • In 2013, the Canadian pension fund CDPQ acquired a 26.67% stake in the Port of Brisbane for about AUD 1.4 billion, implying an enterprise value (including debt) of AUD 6.2 billion and a multiple of roughly 27 times annual earnings (EBITDA). • In 2014, the Port of Newcastle in New South Wales was sold for AUD 1.75 billion under a 98 year lease. The NSW Government indicated this figure was some 27 times the annual earnings from that port. The budgeted sales price was AUD 700 million. The Port of Melbourne made an AUD 65.9 million operating profit in the 2012/13 financial year and AUD 123.4 million in earnings before interest and tax (EBIT). Adding back AUD 75 million in depreciation and amortisation, the Port’s earnings before interest, tax, depreciation and amortisation (EBITDA) were around AUD 200 million. Applying a 25 times multiple suggests a valuation of at least AUD 5 billion for a 99 year lease. However, the Port is experiencing significant growth and is strategically significant. A figure of AUD 5 billion for a may therefore be at the more conservative end of any valuation range. If the 99 year lease proposed by the Labor Party were adopted, the Labor Party has suggested that it would expect to receive at least AUD 6 billion.
  • 5. Privatisation of Port of Melbourne, Australia 05 Norton Rose Fulbright Preliminary issues A number of issues are raised by the proposed privatisation of the Port of Melbourne. Some preliminary issues worthy of consideration for potential bidders include: • the current expansion of the Port and development of a second port; • the extent to which regulatory clearances may be required by bidders; • the extent to which Victorian regulation of port charges will be maintained; and • the extent of any Commonwealth regulation of port charges. There are also a number of unique features of the Port that would need to be considered in due diligence Expansion of the Port and development of a second port In 2011, the Australian Competition and Consumer Commission (ACCC) suggested that if further capacity were not developed by the Port of Melbourne, capacity constraints could be encountered as early as 2015. The Port of Melbourne currently has two international container terminals located on the east and west sides of Swanson Dock with a capacity of some 2.7 million TEU. However, container trade at the Port is forecast to double over the next decade, from the current level of 2.51 million TEU. Annual compound growth rates are forecast to be around 6% per annum. Automotive units are similarly expected to double over that period from the current 370,000 automotive units handled and are forecast to exceed 1 million units by 2040. To address these issues, the Victorian Government announced in April 2012 that it would undertake an AUD 1.6 billion redevelopment of the Port, including the construction of a new container terminal at Webb Dock East, a new world class automotive terminal, and infrastructure upgrades at the existing container facility at Swanson Dock. In March 2013, the Port commenced construction of the new container handling terminal. The new terminal will add further capacity of around 1 million TEU to the Port from late 2016. The Government has also suggested that the upgrading of Swanson Dock could increase capacity to some 4 million TEU. We understand an expanded Port of Melbourne could be able to manage around 5.1 million TEU by the early 2020s. In the longer term, the expansion of the Port of Hastings has been estimated to cost up to AUD 12 billion in order to provide a further capacity of some 9 million TEU. The precise details of any such expansion are still being considered, but the ultimate objective of the expansion would be to make the Port of Hastings the primary freight facility in Victoria. Bidders will need to consider how the extent and nature of any rights in relation to the development of a second port may influence the sale price. We are unclear at this stage whether the Victorian Government would intend to confer any rights on bidders in relation to the Port of Hastings, but the privatisation of the Port of Melbourne could include an option to participate in any expansion and development of the Port of Hastings. In considering the nature of any such optionality, the Government will also likely consider the views of port users. Some port users have stated that they would prefer the Port of Melbourne and Port of Hastings to be independently privatised, thereby ensuring competition between the two ports. The same issues arise in relation to the Labor Party’s proposal for a second port at Bay West.
  • 6. Privatisation of Port of Melbourne, Australia 06 Norton Rose Fulbright Regulatory clearances for bidders Key regulatory clearances required by bidders may include foreign investment approvals and competition clearances. Foreign investment approvals are straightforward and rarely withheld, but are a necessary formality. In the context of the current privatisation of the Port of Newcastle, the Government of New South Wales imposed specific bidding restrictions on parties who had a controlling interest in certain operations downstream from that port from bidding for the long-term lease of that port. This restriction was imposed to preserve the independence of the private sector lessee from producers exporting through the port and the integrity of access arrangements. While it is possible that similar restrictions could be applied to the Port of Melbourne, the heavily integrated nature of operations at the Port of Newcastle made such restrictions more critical for that port. Competition clearances may be important if one of the consortium parties has existing port operations in Australia, is a potential or actual user of the Port of Melbourne, or has a relevant ownership association with any such person. If competition issues were identified, the strategy and timing for any approach to the Australian Competition and Consumer Commission (ACCC) would need to be carefully considered. Generally, the ACCC is not willing to provide clearance without undertaking public market inquiries. If confidentiality issues precluded inquiries prior to bid submission, the bid may need to be made conditional on any ACCC clearance. In the sale process adopted by the NSW government for the Port of Newcastle, bidders were required to seek ACCC assessment and clearance for their bids. The ACCC subsequently complained that this resulted in bidders notifying the ACCC of their proposed bids six weeks before final bids were due, but this time frame did not provide sufficient time for ACCC assessment and clearance. The ACCC may be concerned if the acquisition of shares in the Project Company could result in a substantial lessening of competition in any market in Australia. Concerns could arise, for example, if one of the consortium parties was a potential or actual acquirer of services at the port (to the extent that this was not already prohibited by any bidding restrictions). In such circumstances, the ACCC may be concerned at the potential for a vertically integrated port controller to discriminate in favour of its own downstream port operations. However, the inclusion of a Port of Melbourne user or associate in a bidding consortium is not necessarily fatal to any ACCC clearance. The ACCC’s reaction would turn on the circumstances of the case. The Port user or associate could have an immaterial shareholding or role that gave it no practical influence. It may also be possible to provide a voluntary undertaking to the ACCC to seek to address any competition concerns. For example, an undertaking could be provided that competitors to the relevant Port user or associate would be given access to the Port on a non-discriminatory basis. State-based regulation of Port charges Consistent with principles adopted by the Council of Australian Governments (COAG), the Victorian Government will normally seek to promote commercial outcomes where markets are competitive, but implement price monitoring where regulatory oversight is required. Based on the experience in New South Wales with the Port Botany and Port Kembla privatisations, the Victorian Government will wish to retain price oversight powers and monitor prices charged at the Port of Melbourne by the private sector lessee. Under the Port Management Act 1995 (Vic) (PMA), the Essential Services Commission (ESC) is responsible for the economic regulation of the Victorian ports sector. The ESC is the State of Victoria’s independent economic regulator of essential services.
  • 7. Privatisation of Port of Melbourne, Australia 07 Norton Rose Fulbright The PMA establishes an economic regulatory framework that applies to Victoria’s four commercial seaports, including the Port of Melbourne. This framework has two main elements: • First, certain port infrastructure services are subject to the ESC’s price regulation powers under the Essential Services Commission Act 2001 (Vic) (ESC Act). These services are known as the “prescribed services”. At present, the Port of Melbourne is subject to price monitoring in relation to these prescribed services. The level of regulation is subject to five yearly reviews with the potential for heavier or lighter regulation to be applied. • Second, an access regime exists for shipping channels, known as the “Victorian Channels Access Regime”. This regime provides potential users with the right to gain access to declared shipping channels and provides the ESC with powers to make determinations with respect to access disputes (including with respect to prices). However, as no shipping channels have been declared to date, the regime has not yet been activated. Under the first of these two regimes, the prescribed services are currently: • the provision of shipping channels in Port of Melbourne waters, including shared channels used by ships bound either for the port of Melbourne or for the Port of Geelong; • the provision of berths, buoys or dolphins in connection with the berthing of vessels carrying container or motor vehicle cargoes in the Port of Melbourne; and • the provision of short term storage or cargo marshalling facilities in connection with the loading or unloading of vessels carrying container or motor vehicle cargoes at berths, buoys or dolphins in the Port of Melbourne. ESC must conduct a review of the prescribed services every five years to determine the level of regulation (if any) to be applied in respect of the prices charged for the provision of, or in connection with, these prescribed services. In the previous 2009 review, the ESC exercised its price regulation powers by implementing a light-handed price monitoring framework. The 2014 review occurred over the first half of 2014. As at 15 July 2013, the final report of the ESC is being reviewed by the Victorian Minister of Finance. Once the final report has been publicly released, a new price monitoring determination will be developed by the ESC to implement the recommendations of the report. Based on the draft report, we understand that the ESC has recommended the continuation of the existing light- handed price monitoring framework for the Port. However, various changes have been proposed to the regime to reduce the regulatory burden, including the removal of a previous requirement for detailed regulatory accounts. Under the proposed new price monitoring framework (as set out in the draft report), a greater emphasis is placed on self-reporting. The Port will prepare a new Pricing Policy Statement for approval by the ESC and must publish: • an annual reference tariff schedule; • the weighted average annual changes in each of its wharfage and channel fees for prescribed services; • service quality indicators for % of vessels delayed and % of port users reporting satisfaction; • the rate of return earned on each of the prescribed services. The Port will be required to notify the ESC of any complaints that the Port receives and the Port’s response to those complaints. The Port must also provide reports to the ESC on stakeholder consultations on reference tariffs. Potential influence of the ACCC over privatisation structures The ACCC has raised public concerns in the first half of 2014 regarding the potential for privatisation structures to lead to inefficient market outcomes. The ACCC has expressed support for privatisation and commented that “governments should not retain ownership of business enterprises unless there is a clearly stated public policy
  • 8. Privatisation of Port of Melbourne, Australia 08 Norton Rose Fulbright reason for doing so”. However, the ACCC has expressed concern that “privatisations should never be driven by budget goals at the expense of creating a competitive market structure or putting in place appropriate access or price regulation”. The ACCC has advocated, for example, that Governments should consider how the privatisation process can promote competition, including by separating, rather than integrating, potentially competitive facilities. These concerns have partly been directed at the proposed privatisation of the Port of Melbourne. In the ACCC’s submission to the Harper Competition Review, the ACCC commented as follows (at page 38): “In March 2014, it was suggested that ‘there’s a way you can add value [to the Port of Melbourne sale] because by giving rights or options to develop Hastings, you are effectively conferring almost a monopoly’. It was also stated: ‘There’s nothing wrong with [conferring almost a monopoly] because port charges are actually regulated by the Essential Services Commission’. The ACCC notes that the Port of Melbourne is subject to price monitoring by the Essential Services Commission (ESC). This does not, however, provide for the ESC to set or control the Port of Melbourne’s charges. In the ACCC’s experience, price monitoring does not provide an effective constraint on monopoly pricing behaviour. The announcement by the Victorian government in May 2014 that it intends to offer a medium term lease over the Port of Melbourne does not suggest that rights to the Port of Hastings will be included in the Port of Melbourne lease. However, the ACCC remains concerned over arrangements designed to maximise proceeds received by a government by reducing the prospect of competitive provision of port services. Another example relates to Port Botany and the Port of Newcastle. An article in the Newcastle Herald on 11 May 2014 stated: ‘The government has confirmed it leased Botany with a clause that prevented Newcastle from competing against it with a container terminal. And the Newcastle lease is believed to contain a similar undertaking’. “ The existence of these concerns expressed by the ACCC may result in greater political attention being given to the appropriate regulatory settings for the privatisation structure than in the previous privatisations of the ports located in New South Wales. Commonwealth-based regulation of Port charges It remains open for any third party to seek declaration by the Commonwealth Treasurer of aspects of the operations of the Port of Melbourne under the national infrastructure access regime in Part IIIA of the Competition and Consumer Act 2010 (Cth)(National Access Regime). This means that the Port of Melbourne is potentially subject to Commonwealth price regulation as well as the existing State-based price regulation. To avoid the application of the National Access Regime, it is possible for the Victorian Government to have its State-based regime formally certified as “effective” so that only State-based regulation would apply. Two examples of such an approach in relation to ports in Australia include the Dalrymple Bay Coal Terminal in Queensland, and the South Australian Ports Access regime. However, certification would take significant time and this approach was not adopted by the Government of New South Wales in the privatisation of Port Botany and Port Kembla. Accordingly, the Port of Melbourne will most likely continue to remain subject to Commonwealth regulation. Under the National Access Regime, regulation can be applied to services provided via infrastructure following the ‘declaration’ of that infrastructure by the Commonwealth Treasurer. In order to be declared, the infrastructure must meet certain statutory criteria. We would expect many services provided at the Port could meet these criteria. If declaration occurred, the relevant terms and conditions of access to those services (including pricing) could become subject to arbitration before the ACCC in the event that commercial negotiations for access failed. Any
  • 9. Privatisation of Port of Melbourne, Australia 09 Norton Rose Fulbright determination by the ACCC would be legally binding. Port charges could therefore be subject to price regulation by the ACCC on a dispute-by-dispute basis. To date, the National Access Regime has been rarely applied and has been accompanied by significant delays and extensive litigation where it has been applied. Moreover, the National Access Regime has not yet been applied to port infrastructure in Australia. Following the reviews in 2013 and 2014, we expect some future legislative reform to the National Access Regime that will increase the ease with which regulation can be applied, but this seems unlikely to trigger a rush of applications for declaration. In summary, while there is a theoretical risk that regulated access to port services could occur under the National Access Regime, the practical risk may be low. As such, the more critical regulation for the Port of Melbourne is State-based regulation rather than Commonwealth-based regulation. Other issues to be considered in due diligence As part of due diligence, any bidder will need to understand the upside and downside risks associated with the various cash flows generated by the Port of Melbourne under the privatisation structure. The bidder will need to identify the most significant revenue cash flows and the degree of risk associated with those cash flows. The revenue cash flows are affected by port volumes and are constrained by the capacity of the Port. As identified above, they are also subject to regulation. Capacity expansions at the Port will increase cash flows. A number of current and proposed developments at the Port therefore provide potential revenue upside, as identified above. Conversely, events that reduce the efficiency of Port operations will reduce cash flows, including shipping accidents or industrial action, creating inherent operational risk. The Port of Melbourne covers a substantial area of land, so any bidder will need to investigate the title structure. A thorough investigation of the existing leasing arrangements will need to be undertaken. Major leases will need to be assessed to clearly identify major terms, such as length of term, options to renew and the rental levels. Land at the Port may also need to be subject to an environmental audit as part of any due diligence. The precise nature of the separation of the on-going operations at the Port of Melbourne will also be a key issue and will have a direct impact on the nature of the obligations and risks to which the Project Company is subject. In the context of the privatisation of Port Newcastle, the Government of New South Wales indicated that certain functions would remain with the Newcastle Port Corporation (and hence would not to be transferred) including: • harbour master, vessel traffic centre and related port safety operating licence functions; • pilots, including the cutter crew and pilot transfer vessels; and • statutory functions, such as dangerous goods approvals, marine pollution, and emergency response. If a similar approach is adopted with the Port of Melbourne Corporation (PMC), we would expect the Project Company to be subject to a range of contractual obligations to enable the PMC to discharge these functions. We have extensive experience in advising port authorities on compliance with such obligations, as well as general port services commercial arrangements, so are well placed to advise on issues arising in the context of the particular form of separation adopted by the Victorian Government for the Port of Melbourne. Other potential issues for due diligence include issues related to property, litigation, health and safety, security, environment, employment and pensions, intellectual property, information technology, and insurance.
  • 10. Privatisation of Port of Melbourne, Australia 10 Norton Rose Fulbright Our firm Norton Rose Fulbright has one of the world’s and Australia’s leading infrastructure and transport practices and we have long been recognised as a market leader in advising on legal matters in port operations, shipping and port- related infrastructure. Globally, we are now the third largest law firm in the world. We have more than 3,800 lawyers working across some 54 international offices located throughout Europe, the United States, Canada, Latin America, Asia, Australia, Africa, the Middle East and Central Asia. Our firm had its origins as a specialist global shipping and transport firm. We have a specific global focus on infrastructure and transport as two of our six core areas of global expertise. We continue to have the world’s leading shipping and transport practice. We are ranked Tier 1 in Shipping in Australia by Chambers 2014, Tier 1 in Shipping in the Asia-Pacific Region and Tier 1 in Shipping as a global practice. We were also ranked Tier 1 in Transport in Australia by Legal 500 in 2014 with the comment “without question a leader in the market”. Our team Norton Rose Fulbright has long been recognised as a market leader in port and shipping operations, infrastructure sales, privatisations, and construction. We have acted in relation to a number of the recent privatisations in Australia. We have worked on major port acquisitions and developments throughout Australia and the Asia-Pacific. Our combined expertise places us in an ideal position to provide advice in relation to the Port of Melbourne privatisation: • Our team includes market-leading experts in port and shipping operations within Australia and globally. We understand the particular sensitivities with port privatisations and the current market appetite and government approach to privatisations of this nature. • We also appreciate the priority to be placed on managing multiple stakeholders in complex and high profile projects, subject not only to intense political and media scrutiny but the intense and passionate interest of community and local government. • As one of Australia’s leading full service national corporate firms, we have experts in every area likely to be covered by a full legal due diligence of Port Melbourne. Our credentials We have advised extensively on port transactions and operational issues throughout Australia. By way of example: • In 2014, we acted in the key legal role acting for the Queensland Treasury Corporation in the scoping study for the proposed AUD 3.5 billion privatisation of the Port of Gladstone. We have also acted in confidential roles in a number of the other port sales. • In the State of Victoria, we advised Challenger on the proposed acquisition of the Port of Geelong from the Victorian Government by TNT and on the sale of the port to a Toll Group Syndicate. We also advised on the acquisition of the Port of Hastings from the Victorian Government by TNT and on the sale of the port to a Toll Group syndicate.
  • 11. Privatisation of Port of Melbourne, Australia 11 Norton Rose Fulbright • Other ports and port infrastructure we have acted in relation to include Freemantle Port, Port Hedland, Port of Brisbane, Port Mackay, Port Esperance, Port Newcastle, Port Geelong, Port Hastings, Port of Kembla, Port of Sydney, Kwinana, Koolan Island, Kooragang Port, Port Waratah, Curtis Island, Abbott Point, and Port Albany. We have a detailed credentials statement identifying our experience in Australian ports that further identifies our expertise. We are happy to provide a copy on request. We hope this briefing note is useful. Please let us know if we can further assist. Contacts For more information in relation to the privatisation, please contact any of the following partners: Adrian Ahern Partner / Chairman Norton Rose Fulbright Australia +61 2 9330 8216 adrian.ahern@nortonrosefulbright.com Jo Crew Partner / Head of Infrastructure Norton Rose Fulbright Australia +61 3 8686 6313 jo.crew@nortonrosefulbright.com Nigel Deed Partner Norton Rose Fulbright Australia +61 2 9330 8915 nigel deed@nortonrosefulbright.com Chris Redden Partner Norton Rose Fulbright Australia +61 2 9330 8435 tom.young@nortonrosefulbright.com Dr Martyn Taylor Partner / Author of this note Norton Rose Fulbright Australia +61 2 9330 8056 martyn.taylor@nortonrosefulbright.com Vincent Dwyer Partner Norton Rose Fulbright Australia +61 2 9330 8238 vincent.dwyer@nortonrosefulbright.com Shane Bilardi Partner Norton Rose Fulbright Australia +61 3 8686 6577 shane.bilardi@nortonrosefulbright.com Tom Young Partner Norton Rose Fulbright Australia +61 7 3414 2845 tom.young@nortonrosefulbright.com Norton Rose Fulbright References to "Norton Rose Fulbright", "the law firm", and "legal practice" are to one or more of the Norton Rose Fulbright members or to one of their respective affiliates (together "Norton Rose Fulbright entity/entities"). In respect of this bid, advice and services will be provided by Norton Rose Fulbright Australia (the "Contracting Party") in accordance with its terms of engagement. No other Norton Rose Fulbright entity nor any individual who is a member, partner, shareholder, director, employee or consultant of, in or to any Norton Rose entity other than the Contracting Party accepts or assumes responsibility, or has any liability, to you or any third party for advice or services provided. Any reference to a partner or director is to a member, employee or consultant with equivalent standing and qualifications of the relevant Norton Rose Fulbright entity. www.nortonrosefulbright.com