ACCC approves mammoth $23.6b private equity takeover of Sydney Airport – World News

ACCC approves mammoth $23.6b private equity takeover of Sydney Airport

One of the biggest corporate deals in Australian history is one step closer after the competition regulator gave it the green light.

Australia’s largest airport is one step closer to a historic buyout as the competition regulator approved a $23.6 billion sale to a private equity consortium.

The Australian Competition and Consumer Commission said on Thursday it sees no reason to block the purchase of Sydney Airport by a group of investors, as the monopolistic nature of Australian air travel means there will be less competition.

The deal – which is set to be the largest in Australia’s corporate history – requires only foreign ownership approval, court approval and the blessing of Sydney Airport shareholders to proceed.

The airport’s board accepted a $23.6 billion bid in November after rejecting the previous two bids.

Shareholders were previously wary of opportunistic takeovers at a time when the airport’s passenger numbers – and share price – were battered by the pandemic.

The company was nearly halved in early 2020 as the coronavirus pandemic hit, and international borders were closed to stop the spread. It has crawled back since the vaccine’s development increased confidence among investors and consumers.

ACCC chairman Rod Sims said the regulator’s investigation found there is little – if any – competition between Australian airports, and so there is little to suggest that the takeover would damage the landscape.

“We have been saying for a long time that Australian airports like Sydney Airport are natural monopolies, with significant market power and no price regulation,” Mr Sims said.

The proposed set of buyers are IFM’s Australian Infrastructure Fund and Global Infrastructure Fund, AustralianSuper, QSuper and Global Infrastructure Partners.

Mr Sims said the ACCC acknowledged that there was some minimal potential for competition between airports with respect to certain aeronautical services, for example when an international airline wants to enter the Australian market or when airports are close to each other. are located.

However, taking into account the minimum level of this potential competition, the proposed acquisition will not be sufficient to reduce competition.

Shares of Sydney Airport were last up 2.8 percent at $8.585, under an $8.75 per share cash offer made by the consortium.

Sydney Airport operates three passenger and seven cargo terminals and supplies a number of aeronautical services and facilities to airlines, retailers and other users.

Read related topics:Sydney

Source link

Leave a Comment

Your email address will not be published. Required fields are marked *