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Super funds get airport bid off the ground after early turbulence

September 15, 2021

Super funds get airport bid off the ground after early turbulence

Global fund manager IFM’s infrastructure and superannuation consortium recently moved closer to its acquisition of Australia’s only listed airport after its first two proposals were rejected earlier this year.

Global fund manager IFM’s infrastructure and superannuation consortium recently moved closer to its acquisition of Australia’s only listed airport after its first two proposals were rejected earlier this year.

Owned by 23 world-leading pension funds and with a massive $172 billion in funds under management, IFM has made a name for itself investing in infrastructure, debt investments, listed equities and private equity.

The consortium, dubbed the Sydney Aviation Alliance, consists of the IFM Australian Infrastructure Fund, the IFM Global Infrastructure Fund and Global Infrastructure Partners, AustralianSuper and QSuper.

The acquisition showed signs of taking off earlier this week after Sydney Airport awarded the consortium with the opportunity to conduct due diligence after a third non-binding proposal was submitted.

The announcement was made on the ASX stating that the consortium’s latest non-binding proposal satisfied requirements with its scheme of arrangement and trust scheme of 100% of the stapled securities.

It’s worth noting that the indicative price per stapled security was increased to $8.75 cash – an uptick of $0.50 from the initial offering in July this year.

Analysts have not predicted a rival bid to occur due to the scale of funding needed and the requirement for the airport to remain 51% Australian-owned.

In the absence of a superior bid, Sydney Airport’s board has committed to unanimously recommend the consortium’s $32 billion offer to its security holders subject to a satisfactory assessment of the offer terms and to the parties entering into a binding scheme implementation agreement.

The recommendation is also subject to an independent expert concluding that the proposed transaction is in the best interests of Sydney Airport securityholders.

The due diligence will be conducted on a non-exclusive basis and is expected to take four weeks from both parties entering into a non-disclosure agreement.

Sources:

 


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