MEIF3's Copenhagen exit prompts Danish regulatory review

Macquarie's decision to launch a strategic review of its ownership of Copenhagen Airport has been met with a possible regulatory reaction from Danish authorities.

The government, which holds a 39.2 percent stake in the airport, believes the site to be of “vital importance” to Denmark's economy and said it will consider strengthening the regulatory regime to ensure future owners are focused on the long-term nature of the asset.

A spokeswoman for the government told Infrastructure Investor that the reaction was a direct consequence of Macquarie's announcement last month that it may sell its 57.7 percent stake in the airport, held jointly with the Ontario Teachers' Pension Plan, as the life of the Macquarie European Infrastructure Fund III draws to a close.

“The Ministry of Finance will on behalf of the Danish government follow the potential transaction closely,” Finance Minister Kristian Jensen said. “It will be a key concern that the Copenhagen Airport continues to be a modern and efficient airport with sufficient capacity to ensure connectivity of the Danish economy and society in the future. This requires that the airport is controlled by investors with a long-term view on value creation. The Danish government will evaluate the regulation in light of this and if necessary, strengthen the regulation.

“The regulatory framework around the airport and related activities shall support growth and connectivity, and it is a central purpose that the regulation supports long-term investments that will ensure continued development of the airport infrastructure.”

The spokeswoman was unable to comment further on what the Danish authorities would consider “long-term”. Macquarie first invested in Copenhagen Airport in 2005 through Macquarie Airports Management, shifting its ownership to the €1.2 billion MEIF3 in 2008 . Passenger numbers at the airport have increased by more than 9 million in the 12 years that Macquarie has had an interest in the asset. A Dkk20 billion ($3 billion; €2.7 billion) expansion project is expected to lift numbers to 40 million by 2024.

PKA, a Dkk250 billion Danish pension fund, said shortly after Macquarie's strategic review announcement that an investment in Copenhagen Airport would meet its “sweet spot”, emphasising the long-term nature of the asset. It had not responded to requests for comment by press time.

Denmark recently approved new measures for greater oversight of pension fund investments in alternatives after expressing concerns institutions may not have the necessary skills to comprehend such asset classes.