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Northland Port sells half of Sea-Tow

By Phil Boeyen, ShareChat Business News Editor

Thursday 5th October 2000

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Northland Port is selling half of its interest in its tug and barge subsidiary, Sea-Tow, to Australian marine towage company, Adsteam Marine.

Adsteam Marine will pay around $4.35 million in cash for its 50% shareholding, and has also been granted an option to purchase the rest of the company in 2005.

The port company says the transaction will allow Sea-Tow to refinance its long-term borrowings and will be able to repay $12 million to Northland Port.

Northland Port chairman, Mike Daniel, says the sale of half of Sea-Tow completes the 'tidy-up' of the port company's assets and follows the sale of non-performing subsidiaries Marine Steel, Central Cranes and Northport Engineering.

Adsteam says the Sea-Tow purchase will be the cornerstone of the company's strategy to further develop tug barging operations in Australia and New Zealand.

Adsteam entered New Zealand's maritime services business over two years ago when it bought the international shipping agency operations of Burns Philp, and it now has operations in ten New Zealand ports.

Following the Sea-Tow sale and asset tidy-up Northland Port says its main remaining assets now include a 50% interest in the new Marsden Point deep water port, a one-third interest in the wharf services company at that port, a 50% interest in Sea-Tow, plus land at the new Marsden Point port and at Port Whangarei.

The company also has around $20 million cash with no debt, and says its directors will consider "all available options to further enhance shareholder wealth over the next few months".

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