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Sale of ADI Limited.



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JOINT MEDIA RELEASE

 

The Hon John Fahey

Minister for Finance and Administration

 

The Hon Ian McLachlan AO

Minister for Defence

 

55/98

Sale of ADI Limited

 

Following the substantial settlement of an ammunition supply agreement between the Department of Defence and ADI Limited, and as previously announced, the Government is now seeking Expressions of Interest in acquiring ADI Limited through an open tender trade sale.

 

Advertisements have been placed in national newspapers requesting potential purchasers to contact the Government’s business advisers for the sale, Baring Brothers Burrows & Co. Expressions of Interest are to be lodged no later than midday on Thursday July 9 1998.

 

ADI Limited is a wholly Commonwealth-owned company offering high quality capabilities in project management, systems and communications engineering, precision and heavy engineering, ship building and maintenance, ordnance and the provision of environmental and logistic support services. In addition, ADI Limited has an interest in two large residential development property joint ventures.

 

The sale of ADI Limited is expected to facilitate the growth of a sustainable, competitive and efficient Australian defence industry through private capital investment and technology transfer.

 

While the Government’s strong preference is to sell ADI Limited in its entirety, by way of a sale of all of the share capital in ADI, the sale of individual business units or groups of businesses will also be considered.

 

A significant amount of work has been undertaken to prepare ADI for sale. A new ammunition supply agreement between the Department of Defence and ADI has been substantially settled. These arrangements reflect the Department of Defence’s long-term ammunition requirements and support the Government’s continuing commitment to maintaining an Australian munitions capability.

 

The Government’s objectives for the sale of ADI Limited are as follows:

 

* to optimise sale proceeds within the context of the Government’s other sales objectives;

 

* to minimi se the Commonwealth’s exposure to residual risks and liabilities;

 

* to ensure that the new owner or owners have the necessary financial capability to complete

 

* the sale and to meet ADI’s current and likely contractual obligations;

 

* to ensure that the new owner or owners have appropriate contract management expertise, capability and commitment to the fulfilment of ADI’s current and likely contractual obligations with the Commonwealth;

 

* to ensure that the new owner or owners have the necessary manageme nt expertise, defence and/or relevant general industry experience, and long term commitment to operate as a credible and effective participant in the Australian defence industry;

 

* to achieve a sale outcome which avoids the retention of any of ADI’s busin esses by the Commonwealth post sale;

 

* to ensure fair and equitable treatment of ADI staff in the sales process; and

 

* to achieve a sale outcome which contributes to a competitive, sustainable and efficient Australian defence industry, as well as to regi onal industry development.

 

The sale is to be conducted by the Office of Asset Sales & IT Outsourcing (OASITO), in consultation with the Department of Defence. Baring Brothers Burrows & Co., Limited together with Blake Dawson Waldron and Arthur Andersen Co rporate Finance is handling the sale process on behalf of OASITO.

 

12 June, 1998

 

Media contact: David McLachlan, John Fahey's Office 02 6277 7400

Website: www.dofa.gov.au

 

 

 

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