Lease of Australia's largest port sold for 7.2 bln USD

The 50-year lease for the Port of Melbourne has been sold for 7.2 billion U.S. dollars, almost doubling early price estimates.

The Lonsdale consortium consisting of the Future Fund, Queensland Investment Corporation (QIC) and overseas investors bought the lease for the port, Australia's busiest, Victoria's Premier Daniel Andrews announced on Monday.

"This is a massive vote of confidence in the strongest economy in the country," Andrews said at a press conference.

"Every Victorian should take great pride in the price that has been paid for this asset. This is a very important day for our state."

The former Liberal Government had estimated in 2013 that the sale of the 50-year lease would fetch up to 3.7 billion U.S. dollars; two years later, Andrews predicted that the sale could be worth as much as 4.5 billion U.S. dollars.

Treasurer Tim Pallas said the port being the best of its kind in Australia and the good timing of the sale was responsible for the higher price.

"I think we've been very lucky in terms of timing ... couldn't have picked a better time to go to the market," Pallas said on Monday.

"To say this is a good day and this is a pleasant surprise is an understatement.

"Leasing the port reinforces Victoria's position as the freight and logistics capital of Australia and will make a great port even better."

Andrews confirmed that the proceeds from the sale would be used to fund the Melbourne Metro Rail Project, the level crossing removal project as well as 730 million US dollars going towards funding rural infrastructure.

"We promised to lease the port, get rid of Victoria's most deadly and congested level crossings and create thousands of jobs, and that's exactly what we're doing," he said.

The Port of Melbourne handles approximately 2.5 million 20-foot shipping containers every year. Endit