Airport finance and privatisation 2012 review

2012 was characterised by a paucity of airport M&A transactions, but those that did materialise were quite significant ones, in Portugal, the UK and Brazil. At least prices have started to creep back up, to around 16 times earnings (from 10-13 times in 2011), which should please the sellers if not the buyers. The number of investors has also continued to increase, along with their variety.

During the year Airport Investor Monthly pointed to the growing numbers of pension funds, sovereign wealth funds (the two can be interchangeable) and infrastructure funds that now dominate the airport investment landscape. On occasion a bidding consortium can be made up exclusively of these funds managers with only a modicum of direct airport operational experience contained within it. That experience now often resides within the existing management team, which can be expected to continue to operate the airport subject to overview from the financiers that may involve one or more designated hands-on directors at one end of the scale, to mere attendance at a quarterly board meeting at the other.