The three private equity consortiums bidding for Gatwick, the UK’s second largest airport, have been given an extra month to submit their final offers for the £2 billion asset which is currently owned by the British Airport Association (BAA).
“Following a request from bidders we have agreed a new deadline for final bids for the end of April,” a spokesman for the BAA said in a statement. He added that the extension will allow bidders more time to finalise detailed due diligence and financing arrangements and that the overall timetable for the deal remains on track.
The bidding parties include Global Infrastructure Partners, a $5.64 billion infrastructure fund that already owns 75 percent of London City Airport; Citi is leading a bid with the Vancouver Airport Services and John Hancock Life Insurance; as is Manchester Airports Group along with Borealis Infrastructure, the infrastructure arm of the Ontario Municipal Employees Retirement System, a Canadian pension scheme.
Last month a 3i Group-led consortium, which included Ontario Teachers’ Pension Plan and Canada Pension Plan Investment Board, retracted its bid for the airport amid reports that the £2 billion asking price was too steep.
Spanish firm Grupo Ferrovial, of which BAA is an affiliate, revealed its plans to sell Gatwick in September 2008 following a proposal by the UK’s Commission to force the firm, which owns seven airports including Heathrow, to sell off three of them in order to reduce BAA’s dominance in the market.
When the sale was first announced regulators valued Gatwick and £1.8 billion and predicted that it could fetch as much as £3 billion. Grupo Ferrovial now expects to net around £1.5 billion from the sale, according to Credit Suisse analysts.