Alinda buys 5.88% of BAA for $438m

The Connecticut-based infrastructure investor has increased its stake in the Ferrovial-owned airports operator. Alinda had already invested $604m in BAA in July 2007. Ferrovial, which originally hoped to sell 10% of BAA, will not seek to sell any more of the firm.

Spanish infrastructure group Ferrovial has sold a 5.88 percent stake in UK airports operator BAA to Alinda Capital Partners, the Connecticut-based infrastructure firm, for £280 million (€325 million; $438 million), Ferrovial announced today.

The sale comes a year after Ferrovial first announced that it was seeking to divest a 10 percent stake in BAA, which it bought for £10.3 billion in 2006. Alinda already owned an unspecified minority stake in BAA, for which it paid $604 million in 2007, according to a presentation on potential infrastructure managers that consultancy EnnisKnupp made to the Illinois State Universities Retirement System in October 2009. Alinda could not be reached for comment on its final stake in BAA.

A spokesman from Ferrovial explained that the firm is satisfied with the sale and will not seek further divestments in BAA: “We received different offers and this was the most attractive. At the moment, we have no plans to [sell more of BAA]. The [sale] price supposes an increase on analysts’ valuations,” the spokesman added.

The sale is an important strategic milestone for Ferrovial. By cutting its ownership in BAA to 49.99 percent from 55.87 percent, Ferrovial be able to deconsolidate BAA’s debt from its balance sheet once the deal closes at the end of this month. That will reduce BAA’s debt pile from its current €19.7 billion to €5.19 billion.

BAA’s revenue grew by 11.5 percent to €1.36 billion during the first half of 2011 with earnings before interest, tax, depreciation and amortisation increasing by close to 26 percent to €633 million. Passengers increased by 7.8 percent, with a throughput of 50 million passengers during the first half of the year. 

BAA’s other shareholders include Britannia Airport Partners (26.48 percent), a vehicle managed by Caisse de depot et placement du Quebec, and Government of Singapore Investment Corporation (17.65 percent).

In related news, the airports operator has struck a deal with the UK’s Competition Commission that will allow it to sell either Edinburgh or Glasgow airport ahead of the sale of London’s Stansted Airport. The watchdog had ruled that BAA sell Stansted first, but a second appeal against the sale lodged by BAA is ongoing in the courts.

After BAA sells one of its Scottish airports, it will be left with a portfolio of five UK airports including Heathrow, Stansted, Southampton, Aberdeen and either Edinburgh or Glasgow, depending on which one gets sold.