Ontario Teachers raises stake in UK’s Birmingham Airport-Reuters

(Reuters) – Canada’s Ontario Teachers’ Pension Plan said it had bought a 19.25 percent stake in Birmingham Airport from Australia’s Victorian Funds Management Corporation, taking its investment in the British airport to 48.25 percent.

The investment was led by Ontario Teachers’ Infrastructure Group, which manages a global portfolio of $11.7 billion of investments. Its other airport investments include UK’s Bristol, Copenhagen and Brussels.

The Canadian pension fund wants to strengthen Birmingham Airport’s position as a regional hub in the UK by tapping into its capacity of around 9.5 million passengers per year. The airport, which hosts a number of low cost airlines such as Ryanair, Flybe, Monarch and Thomas Cook, offers domestic and international flights to destinations in Europe, North America and the Middle East. It ranks as the UK’s seventh busiest airport after Edinburgh and Luton, according to the UK Civil Aviation Authority, while London’s Heathrow and Gatwick are in the top two spots with more than 110 million combined passengers, followed by Manchester Airport with more than 21 million annual passengers.

Ontario Teachers first invested in Birmingham Airport in 2001. It then acquired a joint 48.25 percent stake with Victorian Funds Management (VFM) for 420 million pounds in 2007 when Macquarie Airports Group and Aer Rianta made a full exit. The pension fund gave no financial details of their latest buyout.

The Canadian pension fund became the sole owner of the UK’s ninth busiest airport, Bristol, after buying out its co-shareholder Macquarie Group in September. Seven West Midlands district councils have kept a significant ownership of Birmingham Airport and will continue investing alongside Ontario Teachers.

“The shared goal is to develop Birmingham Airport’s connectivity to benefit both the region and the UK as a whole,” said Birmingham Airport Chief Executive, Paul Kehoe.

Ontario Teachers’ is the largest single-profession pension plan in Canada. It pays pensions and invests on behalf of 307,000 working and retired teachers in Ontario.