Sydney Airport announced Monday that it received a takeover offer from a group of infrastructure investors for A$22.3 billion ($17.4 billion). This sent its shares skyrocketing on the Australian Stock Exchange.
The consortium, which includes IFM Investors and QSuper Board, is seeking to purchase Australia’s largest airport operator for A$8.25 per share, Sydney Airport stated in a statement to the Australian Stock Exchange. The stock closed at 42% higher than Friday’s closing price, causing the share price to surge more than 30% in ASX trading.
This offer is a significant bet on the recovery and growth of global aviation. Industry severely damaged by the closure of international borders around the globe to stop the spread of the Covid-19 pandemic. Sydney Airport reported that May’s total passenger traffic fell 59% compared with the same period in 2019.
All consortium members have stakes in Australian and U.K. airports. IFM has stakes in Melbourne, Brisbane, and Perth airports, while QSuper holds a stake at London’s Heathrow Airport. Global Infrastructure invested at Gatwick and London City Airports.
The consortium’s offer is contingent upon UniSuper, which holds a 15% share in Sydney Airport, agreeing to reinvest its equity in Sydney Airport to acquire an equivalent stake in the holding company.
Sydney Airport stated that its board is currently evaluating “whether the proposal is reflective of the underlying value the airport given its long term concession and the anticipated short-term effects of the pandemic.”
As the government struggles with rising infectious diseases in major cities like Sydney, Australia’s international borders have been closed since March 2013.
Before opening Western Sydney Airport in 2026, Sydney Airport held the sole rights to traffic entering and leaving Australia’s largest city.