Fran O’Sullivan points out that the value of the Government’s stake in Air NZ is now only $912 million – less than the $1.034 billion the Government paid for its 76% stake, including a later rights issue.
The share price is now only $1.14 and was $3.12 a year ago. A sensible shareholder would have looked to sell down some of its stake to realise a profit on the purchase. But hey when you get to spend other people’s money you don’t worry about that so much.
Does anyone want to argue that 76% is the right stake for the Crown to own, instead of say 51%?
If we had sold 25% at the peak, then the $840 received would have almost covered cost of the remaining 51%.
So the 76% stake is now $1.6 billion less than a year ago. And add on the $1.5 billion going on Dr Cullen’s trains and you see where all the money is going.