Sydney Airport has agreed to a A$23.6 billion ($17.46 billion; €15.11 billion) takeover bid from a consortium led by IFM Investors, following the completion of a four-week due diligence period.
The company announced it had entered into a scheme implementation deed with the consortium known as Sydney Aviation Alliance, having accepted an offer of A$8.75 cash per stapled security, which will be done via a scheme of arrangement.
The consortium, which also consists of AustralianSuper, QSuper and Global Infrastructure Partners, was granted due diligence in September. The bid represents an uplift in equity value of roughly A$1.3 billion to the consortium’s initial offer of A$8.25 cash per stapled security, which was rejected by the company’s board in July. A subsequent bid of A$8.45 cash per stapled security was rejected by the company’s board in August.
In a statement, Sydney Airport chairman David Gonski said: “Today’s announcement is the culmination of months of engagement between all parties. The Sydney Airport boards believe the outcome reflects appropriate long-term value for the airport, and unanimously recommend the proposal to securityholders.”
As part of the deal, UniSuper – the company’s largest shareholder – is expected to transfer its existing 15.01 percent stake in the airport for an equivalent interest in the holding structure of the consortium.
SAA spokesman and IFM chief executive David Neal said: “The finalisation of the scheme implementation deed is a significant step forward in this transaction, and we look forward to securityholders voting on the proposed deal.
“Our alliance represents many millions of Australians who, upon transaction completion, will be invested in Sydney airport through their superannuation, and we intend to work hard to bring more flights and passengers back to the airport as the aviation industry emerges from covid-19.”
The scheme is subject to a number of conditions, including approval by the Australian Competition and Consumer Commission and Australia’s Foreign Investment Review Board. Securityholders are expected to vote on the proposal in the first quarter of 2022.
Given IFM’s significant stakes in two major Australian airports – Brisbane Airport (20 percent) and Melbourne Airport (25.2 percent) – it is expected the deal will face scrutiny from the ACCC.