Aviation

Sydney Airport set to change hands after board agrees to $23.6bn takeover bid

After months of toing and froing, the board of Sydney Airport has backed a takeover bid for the company by a consortium of investment and infrastructure funds.

In an announcement to the Australian Securities Exchange this morning, Sydney Airport said it had entered into a scheme implementation deed (SID) with Sydney Aviation Alliance (SAA) whereby the consortium would acquire all of the airport’s shares.

SAA comprises various investment and infrastructure funds affiliated with or managed and/ or advised by IFM Australian Infrastructure Fund, IFM Global Infrastructure Fund, AustralianSuper, QSuper and Global Infrastructure.

Under the schemes, Sydney Airport security holders (other than UniSuper) will receive $8.75 cash per stapled security.

Meanwhile, UniSuper will transfer its existing interest of 15.01 per cent in the airport for an equivalent interest in the holding structure of the consortium by acquiring an interest in Sydney Aviation Alliance Holdings, an upstream holding entity of SAA.

The scheme consideration values Sydney Airport’s equity at approximately $23.6 billion and represents an uplift in equity value of approximately $1.3 billion to the price of $8.25 initially offered by the consortium in July 2021, and a $7.9 billion uplift to the closing price on the business day prior to the airport’s announcement of the indicative proposal.

Sydney Airport’s board has unanimously recommended that security holders vote in favour of the schemes in the absence of a superior proposal and subject to a review by an independent expert.

The scheme meetings are expected to be held in the first quarter of 2022, and the takeover bid is, of course, subject to various conditions, including approval by the Australian Competition and Consumer Commission and the Foreign Investment Review Board.

Sydney Airport chairman David Gonski said: “Today’s announcement is the culmination of months of engagement between all parties.

“The Sydney Airport boards believe the outcome reflects appropriate long-term value for the airport, and unanimously recommend the proposal to security holders, subject to customary conditions such as independent expert approval and no superior proposal.”


Featured image source: iStock/DoraDalton


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