August 16, 2006
Australian Government to sell ASC
Australia's Minister for Finance and Administration, Senator Nick Minchin, today announced the Government's decision to return ASC Pty Ltd (the former Australian Submarine Corporation) to private ownership.
Today's sale announcement follows consideration of a recent scoping study into the sale of ASC, which examined the optimal timing and method of sale.
It is the Government's current intention that the company be sold through a competitive tender trade sale, to commence in late 2007 and conclude in the second half of 2008. The precise timing and intended method of sale will be re-confirmed closer to that time.
"It is vital that ASC continue to have access to essential technical assistance from international partners and governments. A trade sale will allow the Government to ensure that the company's new owners are acceptable to overseas technology suppliers. A trade sale will also allow the Government to assess the financial strength and industrial experience that potential buyers would bring to the company," Senator Minchin said.
"The Government flagged in 2004 that ASC would not be sold until the AWD and amphibious ship contracts had been decided. The selection of the prime shipbuilder for the amphibious ships and the second pass approval for the AWD project are expected by mid-2007. Starting the sale process in late 2007 will also allow ASC and the Defence Department to finalize a range of sale preparations."
The Government's objectives for the sale of ASC are:
"Any new owner of ASC will need to demonstrate its ability to comply with these sale objectives", Senator Minchin said.
The Government is proposing a foreign ownership limit of 49 percent. A number of other protections will be put in place to protect Australia's security interests. The Chairman, Chief Executive Officer and a majority of directors will have to be Australian citizens and ASC's head office, substantial operations and place of incorporation will have to remain in Australia. These details will be confirmed closer to the time of sale.
"My home state of South Australia is the home of ASC and the Government will ensure that the interests of workers are protected during the sale process," Senator Minchin said.