Kelsian Group has locked in a seven-year NZ$101 million ferry contract in Auckland and is acquiring local operator Belaire Ferries for NZ$8.9 million, marking its first major New Zealand expansion.
- Awarded NZ$101 million Western Package Ferry Contracts in Auckland
- Seven-year term starting July 2027 with revenue indexation
- Acquisition of Belaire Ferries for NZ$8.9 million
- Commitment to procure five new ferries at NZ$38 million capital cost
- Strategic platform established for further New Zealand growth
Seven-Year Auckland Ferry Contract Secured
Kelsian Group (ASX:KLS) has clinched a significant foothold in New Zealand’s passenger ferry market by securing Auckland Transport’s Western Package Ferry Contracts. The deal, commencing 1 July 2027, is valued at approximately NZ$101 million (A$83 million) over seven years, with an option to extend for an additional two years. This contract covers ferry services across Auckland Harbour, including operation and vessel maintenance.
The contract package involves an initial fleet of six vessels; four currently owned by Belaire Ferries and two relocated from Kelsian’s Australian operations. To maintain service quality and fleet modernity, Kelsian has committed to procuring five new ferries over the contract term, with the first entering service in mid-2028. The capital expenditure for these vessels is estimated at NZ$38 million (A$31 million), expected to be financed through a limited recourse ringfenced financing vehicle.
Acquisition of Belaire Ferries Complements Contract Win
Concurrently, Kelsian has entered into a binding agreement to acquire Belaire Ferries Limited for NZ$8.9 million (A$7.3 million). The purchase price includes an upfront cash payment of NZ$2.8 million and deferred contingent payments of NZ$6.1 million, payable over FY2027 to FY2029 subject to milestone achievements. Belaire Ferries currently operates the West Harbour and Rakino Island ferry services in Auckland Harbour, aligning neatly with the new contract area.
The acquisition is expected to complete in the first quarter of FY27, funded from Kelsian’s existing cash reserves. Belaire’s founder, Adam Tallentire, will assist with integration and transition, smoothing the handover of operations under the new contracts.
Strategic Expansion into New Zealand Market
Kelsian Group CEO Graeme Legh described the contract and acquisition as a “strategically important platform” for growth in New Zealand, marking the company’s first major contract in the country. The deal adds to Kelsian’s global multi-modal transport footprint, which already spans Australia, the UK, Singapore, the USA, and the Channel Islands.
The contract includes revenue indexation mechanisms, protecting Kelsian from fluctuations in key cost inputs such as diesel fuel, which is a prudent feature given recent volatility in energy prices. The fleet renewal plan and financing strategy indicate a long-term commitment to the Auckland market, with capital investment spread over the contract term to align with service delivery.
This expansion follows Kelsian’s recent momentum in securing major contracts, including a $500 million extension for Sydney bus services, underscoring its growth trajectory in public transport operations across multiple regions.
Bottom Line?
Kelsian’s Auckland ferry contract and Belaire acquisition establish a solid foundation for further New Zealand expansion, but execution risks around fleet procurement and integration remain key to watch.
Questions in the middle?
- Will Kelsian successfully manage the integration of Belaire Ferries without service disruption?
- How will the planned ferry fleet renewal impact Kelsian’s capital structure and cash flow?
- Could this Auckland foothold lead to further contract wins or acquisitions in New Zealand’s transport sector?