Sydney Airport has rejected a $22 billion takeover bid
The buyout proposal came from a consortium of infrastructure funds and would have been one of the biggest bids seen in within the nation.
The operator of Australia’s largest airport confirmed that the board had unanimously agreed the $22.26 billion bid undervalued the airport and was not in the best interests of shareholders.
The takeover offer from the Sydney Aviation Alliance, a consortium involving IFM Investors, QSuper and Global Infrastructure Partners, offered $8.25 a share.
Buyout bid undervalues Australia’s largest airport
Sydney Airport’s board stated that the buyout plan was opportunistic because the value of the company had been hit by the coronavirus pandemic, which had and continues to disrupt global aviation.
“Sydney Airport is a well-managed and capitalised asset with a long-term concession lease,”
Share prices likely to trade low
The board stated that it recognised that Sydney Airport’s share price was likely to trade below the takeover offer in the short term.
The airport is Australia’s largest and develops strong business through retail space, property, car parking and ground-transport revenue, however, profits have slumped because of the closure of international borders and coronavirus lockdowns.
The airport’s board said the company had rapidly adapted to the COVID-19 environment.
“Sydney Airport is strongly positioned to deliver growth as vaccination rates increase,” the board said.
If the purchase went ahead it would be one of Australia’s biggest buyout deals, with record-low interest rates fuelling a takeover frenzy as investors look to capitalise on the travel sector when international borders reopen.
