$23.6bn Sydney Airport takeover clears first hurdle

The $23.6bn takeover of Sydney Airport is a step closer to being voted on by shareholders.

A $23.6bn takeover offer for Sydney Airport is a step closer to being put to shareholders for a vote. Picture: Darren Leigh Roberts

A $23.6bn takeover offer for Sydney Airport is a step closer to being put to shareholders for a vote after the bid consortium completed its examination of the gateway’s books.

The four-week due diligence period is understood to have provided no nasty surprises for the consortium, made up of IFM Investors, QSuper, AustralianSuper and Global Infrastructure Partners.

In a statement to the ASX, the Sydney Airport board said the negotiation of relevant transaction documents was now under way, following the offer of $8.75 a share.

If the documents are agreed to, the board plans to unanimously recommend that shareholders vote in favour of the proposal, in the absence of a superior offer.

An independent expert is also being consulted on whether the deal is in the best interests of shareholders, given the expected resumption of international travel in coming weeks.

Two previous proposals, offering $8.25 and $8.45 a share, were rejected by the board as “opportunistic” and not reflecting the long-term value of Australia’s largest gateway.

The third offer, at 6.1 per cent above the initial bid, was deemed more realistic, resulting in the board agreeing to open their books to the consortium, known as the Sydney Aviation Alliance.

It is understood the consortium is happy with progress.

Sydney Airport’s largest shareholder, UniSuper, has previously spoken out in favour of the sale, saying it saw merit in the asset being delisted and has a favourable view of the consortium partners.

Under the conditions of the takeover, UniSuper would be required to reinvest its 15 per cent stake in the airport.

Since the first takeover bid was made on July 5, Sydney Airport shares have climbed from $5.81 to $8.34 at Monday’s close, down 3c for the day.

Passenger figures for September, to be released this week, are expected to be among the worst since the pandemic struck due to Sydney’s extended lockdown and very tight restrictions on international travellers.

Last week’s announcement that fully vaccinated Australians could return without the need to quarantine from November 1 was welcomed by CEO Geoff Culbert.

He said the airport would be ready to go as soon as the government gave the green light.

“The past 18 months have been like an operational boot camp for our frontline teams dealing with constantly evolving processes and requirements,” he said.

Sydney Airport posted a $97m loss for the first half of the 2021 calendar, following a full year loss of $145m in 2020.