East Midlands Airport owner eyes acquisitions
Manchester Airports Group (MAG), the owner of East Midlands Airport, has signalled its intention to make acquisitions following the ruling that BAA will likely have to sell Stansted and either Glasgow or Edinburgh Airports.
Speaking to Insider, group chief executive Charles Cornish - who took over the reins at MAG last October, said: "We will almost certainly be interested; presuming they become available we’ll look at getting a vehicle together to buy one of them."
Airports operator BAA will probably be forced to sell two of its main hubs after it lost a bid to appeal against a 2009 sale order by competition authorities. In March 2009, the Competition Commission found that BAA’s seven UK airports constituted a monopoly and ruled that it should sell Gatwick and Stansted, plus Glasgow or Edinburgh.
The company later sold Gatwick for £1.5bn and mounted a string of legal challenges in an attempt to halt further break up of the group. But the Supreme Court has now ruled against its latest bid to stop further sell-offs.
A consortium including MAG, Canada’s Borealis Infrastructure and the Greater Manchester Pension Fund, was in the running to buy Gatwick in 2009, but walked away from a deal after failing to agree a price.
"The shareholders were prepared to back the company in buying Gatwick and that was a £1.5bn acquisition. They are very supportive of MAG, are interested in the value of the group and the dividends it creates,” said Cornish.
He added that overseas investors could also figure in any future deals. "You would almost certainly need an infrastructure fund to put in equity and create a 50-50 joint venture,” he said. “If you look at a good infrastructure asset in the UK, then the sovereign wealth funds from Asia Pacific and the Middle East could also be interested.
"Abu Dhabi has a shareholding in Gatwick, so you would have to consider whether there would be any conflict of interest, but certainly the sovereign wealth funds could be opportunistic here."
