CPPIB to amend offer for NZ's Auckland Airport

WELLINGTON, March 10 (Reuters) - The Canadian state pension fund bidding for a 40 percent stake in New Zealand's Auckland International Airport Ltd (AIA.NZ: Quote, Profile, Research) said on Monday it would reduce its voting rights in response to tighter government regulation.

Canada Pension Plan Investment Board said if its NZ$1.8 billion ($1.4 billion) bid succeeded it would further restrict its voting rights to 24.9 percent of Auckland Airport shares from its originally planned 30 percent.

Last week the New Zealand government tightened rules for foreign investors seeking stakes of more than 25 percent stake in strategic assets.

CPPIB, whose bid is at NZ$3.5980 a share excluding dividend payments, made the decision after careful consideration of the new restrictions, vice president Graeme Bevans said.

"We have taken further initiatives to make it absolutely clear we will not control the airport, even under the revised standards," Bevans said in a statement.

Shares in Auckland Airport, a top-10 company, last traded down 2.6 percent at NZ$2.22, having traded between NZ$1.99 and NZ$3.50 over the past year.

The bid, which closes on Thursday, is seen as having an uphill battle to succeed, with the tougher investment rules seen as an indication the government will not approve the partial offer.

As of Friday, CPPIB had 18.5 percent of Auckland Airport shares.

In addition it needs a majority of voting shareholders to support the bid, and on Friday it said it had 67.5 percent of the votes cast in favour. (NZ$1=$1.26) (Reporting by Adrian Bathgate)