Manchester Airports Group secures £1bn boost to buy Stansted in deal with Australian investors
Manchester Airports Group has struck an £1bn deal with Australian investors in preparation to try and buy Stansted. The deal is conditional on the sale of Stansted going ahead. Australian infrastructure group, Industry Funds Management, has won the contest to buy a 35% stake in the MAG. This will lay the foundations for a takeover of Stansted. MAG is currently jointly owned by Greater Manchester’s ten town halls. The share of MAG owned by Manchester City Council would fall from 55% to 35%, and the other 9 councils would jointly have a 30% stake, down from 45%. Manchester council would have equal voting rights as IFM. All 10 town halls approved the new structure. However, BAA says it will now take its case to the Supreme Court after its case was rejected by UK Court of Appeal last week. MAG already owns Manchester, East Midlands and Bournemouth airports.
Manchester Airport secures £1bn boost to buy Stansted
August 4, 2012 (Manchester Evening News)
Manchester Airports Group has struck an £1bn deal with Australian investors paving the way for a swoop on Stansted airport.
Industry Funds Management has won the contest to buy a 35 per cent stake in the Manchester-based aviation group, which also runs Bournemouth and East Midlands airports.
The deal will lay the foundations for a takeover of Stansted, which competition watchdogs have ordered current owner BAA to sell off.
The Manchester group is currently jointly owned by Greater Manchester’s ten town halls.
But under the deal, which is conditional on the Stansted takeover going ahead, largest shareholder Manchester council would reduce its share from 55 per cent to 35 per cent. The remaining nine councils would jointly have a 30 per cent stake, down from 45 per cent.
Manchester council would have equal voting rights as IFM.
All 10 town halls approved the new structure as the search for a investor began.
The Australian group IFM fought off interest from a Hong Kong billionaire and a venture involving the Abu Dhabi Investment Authority, which has already ploughed millions into Manchester City.
But a swoop for the Stansted hub is still not certain.
BAA continues to appeal against the 2009 decision to force the sale and is now taking its bid to the Supreme Court after its case was rejected by UK Court of Appeal last week.
Analysts suggest the London hub could have a £1bn price tag.
A joint statement from Manchester Airports Group and the Association of Greater Manchester Authorities said: “Manchester Airports Group is aiming high to strengthen its position as one of the leading airport operators in the country.
“Following a strategic review of the group’s performance and future prospect, MAG is pursuing two key recommendations: one to explore the opportunity to add a quality airport to the group and the other to bring in an equity investment.”
The group said the deal would ‘deliver maximum value’ for the region’s town halls – and, ultimately, taxpayers – but declined to comment further until the deal had been rubber stamped.
IFM is an Australian infrastructure fund that has about $34bn invested in 26 different countries. Other parties which had shortlisted were Cheung Kong Infrastructure, the investment vehicle of billionaire Li Ka-Shing and the joint venture between UK private equity group 3i and the Abu Dhabi investment Authority.
It comes after Manchester airport sold an 87 per cent stake in Humberside airport to Eastern Group for £2.3m this week.
3.8.2012 (Financial Times)
Australian group eyes Stansted airport
By Rose Jacobs and Anousha Sakoui
a bidder for Stansted, after winning the contest to buy a £1bn stake in MAG. This is conditional on MAG winning any future contest for Stansted. The agreement of MAG with IFM would give the Australian group 35% of MAG’s equity but an equal share of voting rights with Manchester City Council. The other shortlisted bidders were Cheung Kong Infrastructure,and a joint venture by UK private equity group 3i and the Abu Dhabi Investment Authority. People close to the contest said IFM offered more money for MAG and promised to put more into a Stansted bid. In the IFM deal, Manchester City Council’s equity stake would fall from 55% to 35%.