Dire Straits for Infrastructure Funds

Strait Shipping was established by Jim Barker in 1992, who needed a reliable and cost-effective way of moving his livestock between the North and South Islands.

Strait Shipping was what might be considered a ‘disrupter’, a new entrant with an offering capable of taking material market share from the incumbent. To truly qualify as a disrupter, the new entrant generally needs a different operating model, resulting in either a superior offer or a significantly lower price. 

In this case, not being owned by NZ Rail was enough. The ferry service underwent numerous changes in direction and in 2016 the Barker family sold to the Australian based Private Equity firm, Champ.

Several times every day most of the company’s assets, staff and customers are sent across the Cook Strait. We’re not talking about the levels of risk taken on by explorers crossing the Pacific in canoes, Christopher Columbus, or competitors in the Volvo Ocean Race, but neither are we running a business that delivers parcels, runs a seaport or airport, generates electricity from rain or manufactures cement and plasterboard.