Aena and AXA acquire airport for £433m

September 2013 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

On 1 August, a consortium fronted by Spanish state-owned airport operator Aena and AXA Private Equity announced that it had agreed a deal to acquire London Luton Airport from previous owner TBI Holding, a group jointly owned by Abertis Infraestructuras S.A. and Aena. The new company will pay around £433m for the airport.

The deal will see Abertis sell its 90 percent stake in London Luton to a consortium 51 percent owned by Aena. AXA will hold the remaining 49 percent of the group. The deal is subject to the approval of European antitrust regulators and the Spanish Board of Ministers.

The sale of London Luton is the latest in a number of divestitures by Abertis; indeed, the company has been selling off parts of its airport businesses with regularity. In a statement Abertis noted that the sale of London Luton forms part of the company’s strategy to “continually revise its portfolio in order to optimise the company’s asset base”.

The deal was made via AXA’s third European infrastructure fund which closed in March 2013 with commitments of €1.75bn. Mathias Burghardt, head of infrastructure at AXA Private Equity, noted that the firm, which has already made four investments from the third fund, has been looking to invest in a UK airport for some time. “We tried a couple of times, but we did not find the right deal,” said Mr Burghardt. “Airports are a sector we’ve been looking at for many years, so we’re happy to have found one in the UK. It’s a good long term investment”.

London Luton, the fifth-largest airport in the UK, handles around 11.5 million passengers every year and in January 2012 announced expansion plans which would enable it to handle up to 18 million annually. The airport, which opened in 1938, employs 500 staff directly and 8000 staff indirectly. In 2012, London Luton recorded turnover of £118m and EBITDA of £36.2m. As a result of the acquisition Aena’s EBITDA is expected to be $1.98bn by the end of 2013 compared with $1.45bn in 2012 and $1.08bn in 2011.

Once the deal has been completed Luton will be the sixth-largest in Aena’s portfolio of airports. The chairman of Aena, Jose Manuel Vargas, said that the consortium wanted to “substantially build up Luton in consultation with all its stakeholders. Aena intends to be an active player in the consolidation of the global airport sector and we are delighted to have AXA Private Equity, which is a key infrastructure investor in Europe, as our partner in this initial step we have taken with the acquisition of London Luton.”

Luton Borough Council has welcomed the acquisition but is still considering its position regarding any proposed expansion. “We will be working with Aena and AXA to ensure a smooth transition in the transferring of responsibility for the operation of London Luton Airport which will need to deliver an investment programme for the asset under the terms of the existing concession agreement,” said the council in a statement.

In July, Abertis also announced that it had agreed to sell Sweden’s Stockholm Skavsta Airport and Belfast International Airport, as well as the terminal concessions for Orlando Sanford (Florida) airport and TBI’s airport management business in the US, to US-based ADC and HAS Airports Worldwide for £247m. In March 2012 the company also sold Cardiff Airport to the Welsh government for £53m. As a result of the company’s programme of divestitures, Abertis’ airport business will now be limited to a stake in Grupo Aeroportuario del Pacífico (GAP) in Mexico and Montego Bay airport in Jamaica, both of which are also for sale.

Richard Summerfield