Saudi, French funds to acquire 38% of Heathrow airport

Saudi, French funds to acquire 38% of Heathrow airport

MADRID, Spain — Saudi Arabia’s sovereign wealth fund and a French private equity group will acquire a 38-percent stake in Heathrow, the London airport’s biggest shareholder said Friday.

Heathrow, one of the world’s busiest airports, is owned by the consortium FGP Topco Limited with Spanish infrastructure giant Ferrovial holding the lead role with a 25-percent stake.

In November, Ferrovial said it was planning to offload its stake, with Saudi Arabia’s Public Investment Fund taking 10 percent and the other 15 percent going to French private equity group Ardian.

But the deal had been blocked by a group of small FGP Topco shareholders who demanded they be allowed to sell their shares on the same terms under so-called “tag-along rights”.

“Ardian and PIF have made a revised offer to acquire shares representing 37.62 percent of the share capital of FGP Topco” for 3.3 billion pounds ($4.1 billion), Ferrovial said, indicating it had accepted the bid.

Following further negotiations, Ferrovial said Ardian would acquire around 22.6 percent of the shares and PIF would take 15 percent.

Revised offer

Ferrovial, which specializes in transport infrastructure management operates a vast portfolio of global assets, including airport interests in Turkey and New York.

Heathrow was not seen as a core asset by Ferrovial.

It bought its stake in Heathrow in a 2006 takeover and initially held 56 percent of the hub, before gradually reducing its interest.

Chaired by Rafael Del Pino — the third richest man in Spain, with a fortune valued at $6.1 billion by the American magazine Forbes — the group had initially wanted to sell its entire stake in FGP Topco.

But following the small shareholders’ intervention, it was forced to change its strategy and will retain 5.25 percent of its holding.

The deal remains subject to regulators’ approval, Ferrovial said.

Ferrovial also owns a 50-percent stake in three other UK hubs — Aberdeen, Glasgow, and Southampton, as well as 60 percent of Turkey’s Dalaman Airport and a 49-percent stake in the new Terminal 1 at JFK Airport in New York.

Last year, it angered Spain’s government by relocating its headquarters to the Netherlands in a decision it said would give it access to cheaper credit and make it more attractive to investors ahead of a planned US stock listing.