Auckland City Council has voted against supporting the Canadian Pension Plan's partial takeover of Auckland Airport.
At a meeting on Wednesday night, the council rejected selling its 12.75% share and voted not to support the Canadian company's bid to purchase a 40% stake in the airport.
Mayor John Banks says the council believes it has a better chance of getting the most out of its investment in Auckland Airport without the Canadians owning 40%.
He says it is an investment the council wants to stay with long-term and it should not be compromised.
The Canadians' takeover bid offer closes on Thursday and fund vice president Graeme Bevan earlier said they could work very well with Auckland City Council going forward as mutual shareholders in the company.
The pension fund is poised to take a major stake in the airport despite last minute government moves to restrict its control.
A flood of last minute shareholder acceptances boosted the Canadian stake close to their 40% target.
"I think it's very demonstrative of the fact that the offer is an incredibly attractive one," Bevan says.
The offer of $3.60 a share has attracted many investors when the market price is now closer to $2.30 and last minute acceptances by major shareholders like Infratil have boosted the Canadian stake to 26% - only 14% short of their target.
Macquarie investment advisor Ian Witters says they have been very tenacious.
"They've hung in there, they've complied with everything that's been put in front of them. They're very keen to get this deal, and they believe that they can make it," Witters says.
The Overseas Investment Office also has to give its approval but legal opinions suggest the Canadians will get a clearance because they are prepared to reduce their voting rights below the crucial 25% threshold.
That would leave the government to make the final call.
