Airport operator BAA declines Goldman Sachs offer
BAA, which operates major airports in London and elsewhere around the world, said Sunday it has rejected a friendly offer from New York-based investment bank Goldman Sachs and two pension fund partners to buy the company for '9.4 billion ($16.5 billion). BAA said the proposal did not “reflect the true value of the company.”
Goldman Sachs portrayed itself as a “white knight” to help BAA fend off a hostile takeover bid from Spanish construction firm Grupo Ferrovial. Earlier this month BAA rejected an '8.75 billion ($15 billion) bid by Grupo Ferrovial, which has a large division focused on managing airports, toll roads and other transportation infrastructure under government leases.
Private equity firms and investment banks like Goldman Sachs have taken recent interest in infrastructure holdings because they see them as providing a steady rate of return during the course of decades-long leases. Goldman Sachs created an infrastructure investment team to go after transportation infrastructure deals. A $4-billion bid by a Goldman-led consortium was also recently rebuffed by Associated British Ports, the United Kingdom’s biggest ports group.
The London Telegraph reported that U.S. conglomerate General Electric has emerged as a potential bidder for BAA, which owns and operates Heathrow, Gatwick, and Stansted airports in the London area, as well as airports in four other U.K. cities.
BAA operates the Indianapolis International Airport, and has smaller retail and catering management contracts at Baltimore-Washington, Pittsburgh and Boston Logan airports in the United States. It also has equity stakes in, and manages airports in Budapest, Hungary; Naples, Italy; and a half-dozen airports in Australia.
Grupo Ferrovial is expected to file a formal takeover offer in the next three weeks, but analysts say it will have to substantially raise its offer to win the approval of BAA shareholders, according to news reports.
Airport operator BAA declines Goldman Sachs offer
