Andrew Noël , Bloomberg – Dec 27, 2018 7:00 am
Vinci SA agreed to acquire a majority stake in Gatwick Airport for 2.9 billion pounds ($3.7 billion) as the French construction company expands its portfolio of aviation infrastructure with a major London hub.
The purchase of the 50.01 percent stake from a group of investors including sovereign wealth funds from Abu Dhabi and Australia will be completed in the first half of 2019, the Rueil-Malmaison, France-based company said Thursday in a statement. Existing shareholder Global Infrastructure Partners will manage the other 49.99 percent.
With 45.7 million passengers in 2018, Gatwick will become the largest single airport in Vinci’s global network. Gatwick has been under pressure due to intensifying competition from London’s other airports and lost out to Heathrow, Europe’s busiest hub, in a contest to win government backing for the construction of a new runway. Its operations descended into chaos just before Christmas after drones spotted around the runway led to a prolonged shutdown.
Prior to the deal, Gatwick had outlined 1.11 billion pounds in investment plans to expand the capacity of its two terminals in the next five years. It’s already the world’s busiest single-runway hub, and the biggest base for discount carrier EasyJet Plc and the focus for long-haul leisure flights at British Airways.
The sale values Gatwick at less than 20 times earnings before interest, tax, depreciation and amortization, according to a presentation by Vinci.
Global Infrastructure Partners, which manages more than $40 billion in assets from ports and airports to a vast wind farm in the North Sea, bought London’s second-busiest airport with the consortium of investors in 2009 for about 1.5 billion pounds. Gatwick reported earnings of 411.2 million pounds in the fiscal year through March, on revenue of 764.2 million pounds.
Vinci managed 35 airports as of the end of last year, in countries including Japan, Brazil, France and Cambodia. The company also operates toll roads and a construction business. The company’s shares have fallen 17 percent this year, valuing Vinci at 42.1 billion euros ($47.9 billion).
©2018 Bloomberg L.P.
Vinci S.A. wants to acquire a significant part of Gatwick Airport, in such a way that this French company will expand and, could have an important center in London, so Gatwick will become the largest airport of Vinci S.A. Although Gatwick isn’t one of the best airports in London, because its operations are reduced, it has a very favorable frequency. Vinci S.A. has also managed several airports last year, in some countries, in addition, they operate roads and businesses that are in progress.
- Gatwick could be one of the best airports in London, being a strong competition of some airports that also operate in London.
- Vinci S.A could solidify because, acquire an important part in Gatwick airport, expanding his aviation infrastructure with a major London Hub.
- Gatwick could increase his operations in the next years, and get more flights because is the world’s busiest runway hub.
- Vinci, for his experience managing some airports in other countries, will be the best option to Gatwick from improving his frequencies of flights and his operations management.
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