One of Aurizon’s initial investors has reportedly sold all its stock in the company, as an allegedly biased decision from the Queensland Competition Authority continues to hurt the ASX-listed rail operator.
According to several reports Cooper Investors, which took part in Aurizon’s initial public offering in 2010, has now sold all of its stock.
Cooper Investors reportedly told investors it had decided to sell because of the Queensland Competition Authority’s draft decision late last year, which will limit Aurizon’s revenue from operating the Central Queensland Coal Network to just $3.9 billion for the four-year period between July 1, 2017, and June 30, 2021.
Aurizon believes it should be allowed to earn almost $5 billion over the same timeframe.
Aurizon has asked the state’s Supreme Court for a judicial review into the QCA’s process, alleging chairman Roy Green had failed to act without bias, given his new appointment as chairman of the Port of Newcastle.
Many miners using the CQCN also operate mines which export out of Newcastle, in New South Wales, and Aurizon is suggesting the tough QCA ruling will limit capacity on the CQCN, and drive miners to invest more in expanding their mines in the Hunter Region, rather than in Central Queensland.
Cooper Investors reportedly told its investors the QCA ruling gave Aurizon little incentive to deliver a high capacity, high quality service in Central Queensland.
“If the QCA final outcome is similar to the draft outcome, it will largely offset management’s initiatives and the improving coal volume in the above rail business,” it was quoted as telling investors by AFR.