The Queensland government plans to sell up to 75% of QR's freight
business in an initial public offering (IPO) later this year, with the
aim of generating $A 7 billion to help tackle the state's budget
deficit.
business in an initial public offering (IPO) later this year, with the
aim of generating $A 7 billion to help tackle the state's budget
deficit.
However, a group of mining companies which includes BHP
Billiton, Rio Tinto and Xstrata have formed the Queensland Coal
Industry Rail Group (QCRIG) to challenge the proposed sell-off. QCRIG
argues that a private owner would have too much control over the coal
industry in the state if both track and trains are sold as a single
enitity. The consortium is bidding to buy the only the infrastructure
in a fully-funded deal, and the state would still be free to proceed
with the sale of the above-rail business.
"We have considered the
alternative model under the IPO and strongly believe it does not
represent an optimal or even reasonable future for the state's major
export industry," says QCRIG chairman Mr Nick Greiner. "Our offer can
be settled with the government prior to the IPO and will not be
dependent on volatile equity markets, removing major risk for the state
while also offering early settlement."
QCRIG has the backing
Australian Rail Track Corporation (ARTC), which would become the
infrastructure manager, responsible for long-term operation and
maintenance of the network. ARTC would also participate as an equity
holder.
The state treasurer Mr Andrew Fraser greeted the proposal as
an "unsolicited submission" but said he was willing to review the bid.
"It is a proposal to engage in negotiations as opposed to a binding
bid," he says. "I don't accept that we'll get a higher price overall
for QR [in accepting QCRIG bid]."
