Auckland Airport institutional shareholders snap up new shares, trading halt to be lifted next week

New Zealand's Auckland Airport announced more than 99% of its institutional shareholders elected to take up discounted stock in its 1 for 16 offer. The institutional entitlement offer raised NZD69.4 million, reducing the amount of stock that will be available to other institutions. The targeted total to be raised is NZD126.4 million.

The pro rata entitlement offer consists of four parts – an institutional entitlement offer, institutional book build, a retail entitlement offer and retail book build. Retail investors will be offered shares on the same basis, NZD1.65 a piece, next week.

Chairman, Tony Frankham, stated the success of the institutional component of the offer shows there is strong support for the company. The company commenced a trading halt on 27-Jan-2010, which is expected to be lifted on the NZSX and ASX on 02-Feb-2010. The offer is fully underwritten by Credit Suisse (Australia) Limited and First NZ Capital Securities Limited, the joint lead managers.

As previously announced, 13-Jan-2010 Auckland Airport acquired 24.55% of Cairns and Mackay airports in Queensland, Australia for AUD132.8 million (approximately NZD166.7 million). The acquisition was financed from existing debt facilities and Auckland Airport will use the proceeds of the offer to repay a portion of the debt drawn down to pay for the acquisition. See related report: Auckland Airport should be on a winner buying into Cairns and Mackay Airports. Who's next?

Malaysia Airports downgraded

Shares in Malaysia Airports rose 2.4% yesterday, as OSK Research downgraded its recommendation on the airport operator from “trading buy” to “neutral”. The Melaka Government and its partner, Senai Airport Terminal Services, reportedly forwarded an offer to Malaysia Airports Holdings Bhd (MAHB) to takeover the management of the new USD55.5 million international airport terminal in Batu Berendam.

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Selected airports daily share price movements (% change): 28-Jan-2010