Hamilton City Council’s airport stake likely ‘significantly’ increased in value in wake of Jetstar deal

Wednesday, 18 September 2024

The value of Hamilton Airport, and Hamilton City Council’s stake, is likely to have increased in the wake of the Jetstar announcement, one senior councillor said.

The value of Hamilton Airport - and the 50% stake held by Hamilton City Council - has likely increased “significantly” according to one Hamilton councillor, but that doesn’t mean a share sale should be on the horizon, at least not yet.

Councillor and Economic Development chair Ewan Wilson said that in the wake of the announcement that international flights were returning to Hamilton, “the value of the airport has increased significantly”.

Wilson had also advocated for a share sale in the past, and argued for the merits of getting a commercial partner around the airport board table.

At present Hamilton City Council is the majority owner, holding 50% of the airport stock.

Waikato, Matamata-Piako, Waipa and Ōtorohanga district councils are the remaining shareholders.

Wilson said that while the council’s shareholding has likely gone up, “the Jetstar announcement doesn’t change my position”.

Hamilton City Councillor Ewan Wilson said he believed council should keep a close eye on entities it holds shares in.

“I still believe Hamilton City Council should review its shareholdings in entities that it holds shares in,” he said.

“I’m not saying today we should go to market.”

Fellow councillor Geoff Taylor also advocated a share sale back in May, arguing it could raise much-needed funds “and it may just inject some imagination, ambition into our shareholding arrangements”.

Discussions over whether to sell shares in the airport were also raised back in October last year, when Wilson said a partial sale could help ease council debt.

Airport chief executive Mark Morgan told the Waikato Times that any decision on share sales would need to be made by the shareholders themselves.

“At the end of day, whether or not a shareholder wants to sell down shares is a decision for that shareholder,” he said.

“I’m charged with running the Waikato Regional Airport Company; I don’t have a view on this.”

The Jetstar deal has also put the spotlight on share dividends, which have been flat at $500,000 since being re-introduced after Covid-19 eased.

“There will, no doubt, be ongoing discussions between the Board and our shareholders on future dividends and the timing of those,” Morgan said.

“At the end of the day, decisions about dividend payments are for our Board to make.

“Our shareholders are very supportive of the growth aspirations of the Airport Company in both aeronautical and non-aeronautical initiatives. And they’ve been very supportive of us securing the Jetstar routes.“

Morgan earlier revealed Jetstar will offer travellers three return flights a week between Hamilton and the Gold Coast, and four return flights a week between Hamilton and Sydney.

The first flights are set to take off in June 2025.