Topic: nsw govt
Refer $200bn infrastructure bonanza coming | The Australian p36 Dec 15th 2007. This feature story adds to other background in the press today:
Majority oppose power sell-off A $380,000 sales pitch to promote the privatisation of the state's electricity system has been started by the Premier, Morris Iemma, and his Treasurer, Michael Costa. But they could be wasting taxpayers' money, an opinion poll shows.
Power sale a Chinese takeaway EXCLUSIVE: MORRIS Iemma is considering selling off up to $15 billion worth of power generators to the Chinese Government.
And notice this recently on SAM micro news blog here (14 Dec 07):
And notice this:
- NSW Power sell-off a rare chance, offline page 5 supplement Resources editorial page Dec 15 2007 Weekend Australian, as below with cute picture of NSW ALP spouse Tebbutt of federal infrastructure minister Albanese, beside Premier Iemma. This presumably is the personal link Iemma to Tebbutt to Albanese to PM Rudd to Big China Inc investors in the press today
A choice quote from The Australian feature story hard copy below:
According to the ABS, total assets of super funds reached $1.1 trillion in the December quarter of 2006. Projections by industry analysts indicate that the pool of superannuation savings will escalate to more than $2 trillion by 2020.
But the lack of opportunities to fund these projects means they are being forced to spend the money on infrastructure overseas.
As one investment banker who specialises in infrastructure says: "Water plants, power plants and ports have good commercial rates of return, but a lot of other infrastructure assets don't and so the private sector isn't interested in investing in those."
In the past few weeks Challenger Infrastructure Fund announced it was part of a winning consortium for the pound stg. 4.19 billion ($9.7 billion) Southern Water Capital water and sewerage group, which was put up for sale by Royal Bank of Scotland earlier this year, and a few days ago Colonial First State Global Asset Management announced it had won a bid to acquire United Utilities Electricity Limited for $3.88 billion. Meanwhile, Sydney-based Spark Infrastructure has revealed it is looking at a gas distribution business in the US valued at up to $1 billion.
Australia's top 10 infrastructure funds are drowning in cash as they increasingly struggle to find assets to invest in.
Put simply, in the past 18 months, 72 infrastructure funds have been established globally, raising more than $US160 billion ($182.2 billion), and of them, 17 have raised more than $US2.5 billion, all looking for infrastructure assets. The problem with this is a lack of suitable assets.
In a recent report, Australia's Infrastructure Priorities -- Securing Our Prosperity, IPA identified three sources of funding: superannuation funds, state government funding, and increased gearing levels by the states offering up debt funding.
IPA's Mr Birrell says despite this money looking for a home, there are not enough opportunities in Australia. "There is no matching of the funds with assets and so you are seeing companies like Macquarie Bank and Colonial buying water assets overseas," he says. "They could be doing a lot more here if they had the opportunity." ..... [bold added]
More background revealing articles on this big corporate govt play are here:
Related story same page/day in The Australian
Postscript #1 28th Dec 2007
- 27 Dec 07, page 1 story Union backs Labor rebels - National - smh.com.au
Other relevant older stories
- 29 Nov 07 Power station plans shelved | The Australian