Bidders for BAA’s Gatwick airport are to be screened by the Competition Commission in early March, around the same time that the watchdog will publish the final report of its two-year investigation into BAA.
The Financial Times said that rival groups, comprising Global Infrastructure Partners, a consortium headed by Citi Infrastructure Investors and a partnership between Manchester Airport Group and Canada’s Borealis, are already holding meetings with the transport department.
The report said that BAA’s owner Ferrovial has decided to work closely with the Competition Commission on Gatwick, which only has formal powers over the sale process of airports and potential break-up of BAA.
Fully-funded final binding bids are due by the end of March, with hopes of completion by the end of May. A preferred bidder is expected by mid-April with the remaining period providing time for anti-trust clearance.
The price tag is expected to be between £1.7bn and £2bn, requiring debt of up to £1.1bn.
A partnership between 3i’s listed infrastructure fund and two Canadian pension funds, and a consortium involving infrastructure funds owned by Babcock & Brown and Deutsche Bank have already pulled out.
Reports suggested that 3i Infrastructure could not find debt financing for the deal, but sources suggest that overpricing had been an issue for the fund rather than the specifics of debt financing.
Source: Thomson Merger News
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