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A revised play for Heathrow: The Public Investment Fund (PIF) and Paris-based equity firm Ardian have reached a revised agreement with Spanish infrastructure company Ferrovial for the acquisition of part of its stake in London’s Heathrow Airport, according to statements from Ferrovial and Ardian (here and here). The revised agreement will see the PIF and Ardian acquire a 37.6% stake in the airport for GBP 3.3 bn (c.USD 4.1 bn).
What we know: Ferrovial has been looking in the past months to divest its entire stake in FGP Topco, the airport’s parent company. Under the revised agreement, the PIF will acquire a 15% stake in FGP Topco, while Ardian will take control of a 22.6% stake, according to the statement. The acquisitions will be executed through separate vehicles. PIF had previously entered a binding agreement with FGP Topco in November to acquire a 10% stake. The previous agreement also included Ardian grabbing a 15% stake, bringing the total value of the agreement at the time to GBP 2.4 bn.
It’s been months in the making, with a major sticking point to resolve: The revised agreement comes after some of FGP Topco shareholders exercised their tag-along rights as they look to offload a 35% stake, according to Ferrovial. The shareholders had demanded that they be bought out to avoid blocking the full sale. The transaction remains subject to the right of first offer and full tag-along rights that could be exercised by other Topco shareholders. It also remains subject to regulatory approval.
SOUND SMART- If a shareholder exercises tag-along rights, the buyer must take their shares at the same price it offered other shareholders — or walk away.
IN OTHER M&A NEWS-
Shell beat oil giant Aramco’s bid for the acquisition of Singapore’s state-owned investment firm Temasek’s liquefied natural gas trading business Pavilion Energy, Shell and Temasek said in separate statements (here and here). The purchase comes a few months after Temasek shortlisted Shell and Aramco for the sale of its LNG subsidiary’s assets. No purchase price was disclosed but Temasek valued Pavilion Energy at USD 3.6 bn at end of March 2023, Financial Times reported. The transaction’s value reportedly came in lower as it excludes Pavilion’s stake in a gas project in Tanzania, the salmon-colored paper reports, citing a source it says is in the know.
