23 Sep 2016

Council pays $880k in fees for failed asset sale

12:36 pm on 23 September 2016

A Christchurch City Council-owned business spent $880,000 in fees in its attempt to sell one of its companies.

City Care vehicle in Wellington.

Photo: RNZ / Alexander Robertson

Christchurch City Holdings Ltd (CCHL) tried to sell roading and maintenance business City Care but the sale fell through in July when the final bid left on the table failed to meet the price the council was seeking.

City Care was the first asset sale the council had attempted as it sought to raise $600m to help balance its books, and it hasn't tried to make any more sales since.

Mayor Lianne Dalziel said this week there was no immediate need to do so thanks to the council's ability to borrow against its businesses which have increased in value.

CCHL paid $880,767 in fees for the failed City Care sale including $311,720 for financial advice from investment bankers Murray and Co and $195,492 to accountants Deloitte. The balance mostly includes legal fees - apart from $3499 for meeting room hire and catering.