He claims small investors are being disenfranchised by big funds that use their money and lobbying power to buy good Australian companies. There doesnt seem to be too much of a control premium being placed into this price and really youre getting less than you could get two years ago, he said. SCACH Financial Report for the half year ended 30 June 2021. Sydney Airport, one of the few remaining airports still listed on a stock exchange anywhere in the world, has been snared by the global M&A boom after a group of big investors pounced on its pandemic-stricken share price to lob a $22 billion takeover bid. Infrastructure assets are attractive to big investment and superannuation funds because they provide stable long-term returns, and often have concessions that allow prices to be increased in line with or above the rate of inflation. "It's the right timing to be looking at these assets which have got a 75-year life when conditions are arguably at the bottom," said a Sydney Airport investor who declined to be named because the person's firm was still assessing the proposal. JPMorgan forecasts the airports international passenger numbers will still be down 65 per cent in 2022 compared with 2019 and not return to pre-COVID-19 levels until 2024. Follow the topics, people and companies that matter to you. Kroll said the airport was worth between $7.94 and $8.86 per share. The proposal comes as record-low interest rates prompt pension funds and their investment managers to chase higher yields. We pay respect to Elders past, present and emerging, and recognise the continuation of cultural, spiritual and educational practices of First Nation peoples throughout Australia. The consortium requires UniSuper to retain as part of the takeover agreement so that it will have enough Australian-based owners to meet foreign ownership rules. . Western Sydney International airport has been given its three-letter code by the International Air Transport Association in a show of confidence in the new gateway. AustralianSuper is part of the consortium trying to buy Sydney Airport and holds stakes in several other big infrastructure assets, including tollroads managed by Transurban and NSWs Port Botany. The consortium, named the Sydney Aviation Alliance, is understood to have a positive view on the eventual return of global air travel as vaccines are distributed, as well as Australias future economic and population growth and the need for people to fly around the country. This Master Plan is renewed every five years. If this [asset] disappears, it will be gone, and along with virtually every other airport will be unable to be invested in by retail or institutional investors.. Mr Pinn also argues that privatisations and takeovers of the nations infrastructure assets are not fairly redistributing wealth among Australians because many of the funds buying them are foreign entities that take advantage of tax havens. The June COVID-19 outbreak in Sydney has stopped domestic travellers flying in and out of the airport. Jarden analyst Anderson Chow raised his 12-month target price on the airports stock to $8.50 from $7.60 amid expectations the consortiums revised bid will be successful. IFM Investors is bidding with US infrastructure investment firm Global Infrastructure Partners and domestic superannuation funds AustralianSuper and QSuper. Harry Dudley, investment analyst at Watermark Funds Management, said that while the bid appeared opportunistic, coming just after NSW reported its highest COVID-19 case numbers for 2021, the offer price was respectable. Due diligence should be relatively straightforward in this instance given the nature of the company and the pedigree of the consortium in the sector.. Sydney Airport acknowledges the Traditional Custodians of the lands, waterways and skyways where we work and in which we live. Sydney Airport, alongside other leased Federal airports in Australia, is subject to a planning framework in the Airports Act 1996. Ben Clark, portfolio manager at TMS Capital which has owned the airports shares for a decade and currently has a stake of less than 1 per cent, said the takeover bid highlighted the short-term focus of some investors that had sold shares after COVID-19 broke out and most air travel stopped. Sydney property prices, the bellwether of the Australia market, advanced for the first time in 13 months in February in a positive sign for home values that have been under . UniSuper, which also holds stakes in Adelaide and Brisbane airports, said it was not a consortium partner nor privy to any details outside information disclosed publicly. Australias Airports Act requires that at least 51 per cent of airports must remain locally owned and operated. Operational efficiency and continuous improvement, Cyber security, technology and innovation. Sydney Airport shareholders on Thursday were poised to approve a A$23.6 billion ($16.85 billion) cash takeover by infrastructure investors, though many small retail investors voted against . Elon Musk was expected to reveal new EVs at Wednesday's Investor Day, but instead, he shared details of a $10 trillion Master Plan 3 to eliminate the use of fossil fuels. The airport also makes a significant contribution to the local and national economies. International Terminal 1 3:00am - 11:00pm, Domestic Terminal 2 & 3 4:00am - 11:00pm. The gap between the airports current share price and the consortiums offer reflects potential risks to a deal completing, including securing regulatory approvals. Other states have closed borders to Sydney residents. How retail investors decide to vote in the scheme meeting will be significant because they account for 93 per cent of the airports 128,567 registered security holders. Operational efficiency and continuous improvement, Cyber security, technology and innovation. 2021 Half Year Financial Report and Appendix 4D. QSuper owns a stake in Britain's Heathrow Airport whereas Global Infrastructure is invested in that country's Gatwick and London City airports. Read more about the transaction here. SYDNEY -A group of infrastructure investors has proposed one of Australia's biggest-ever buyouts, a A$22.26 billion purchase of Sydney Airport Holdings Pty Ltd, taking a longer-term view on the. The goal of this regulation is to create harmonised rules for financial market participants and financial advisers regarding the integration of sustainability risks in investment decision-making, and the consideration of adverse impacts See an overview of Sydney Airport including performance highlights. RBA. In a statement, Sydney Airport . Typically issued within 12 . The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. Sydney Airport declined to comment. International Terminal 1 3:00am - 11:00pm, Domestic Terminal 2 & 3 4:00am - 11:00pm. Follow the topics, people and companies that matter to you. Mr Pinn wants the competition regulator to focus on the bigger picture if a Sydney Airport transaction which has been backed by some institutional investors proceeds and examine how a small group of people are gaining influence and control over Australias airports. We see the revised offer price as fair, Mr Haralambidis said. The proposal is conditional on a unanimous recommendation from the airports six-member main board and a separate Sydney Airport Trust board as well as satisfactory due diligence and regulatory approvals from the Foreign Investment Review Board and the Australian Competition and Consumer Commission. We are absolutely disgusted by the boards narrow view of a monopoly (if not oligopoly) business and their absolute failure to consider the long-term position, Mr Robilliard said. We believe that by focussing on sustainable growth, we will deliver long-term value for our stakeholders. Sydney Airport shareholders were poised on Thursday to approve a A$23.6 billion ($16.8 billion) cash takeover by infrastructure investors, though many small retail investors voted against delisting Australia's only listed airport.. James Brickwood. So it's a matter for the New South Wales Government who are actually building it, as they're the contractors. Sydney Airport noted the offer was below its pre-pandemic share price and said it would review the proposal, which is contingent on granting due diligence and recommending it to shareholders in the absence of a superior offer. hit back at suggestions it exerts excessive influence. The news sent the stock up as much as 38% to A$8.04 in early Monday trade, though it later retreated to around A$7.55, indicating market uncertainty as to whether the deal will succeed. It means a binding deal could be signed as early as next month, and IFM Investors and the other investors could formally take control of the company early next year. ", Australia's international borders are widely expected to remain closed until at least the end of the year due partly to a slower vaccination programme than in most developed countries. Krolls valuation assumes that Sydney Airports domestic passenger numbers return to pre-pandemic levels by 2023 and international passenger numbers return by 2024. We pay respect to Elders past, present and emerging, and recognise the continuation of cultural, spiritual and educational practices of First Nation peoples throughout Australia. IFM holds stakes in major airports in Melbourne, Brisbane, Perth and Adelaide. Ben Clark, portfolio manager at TMS Capital, said he had sold half of his position in the airport very recently. Members of the government have become increasingly concerned about the rising power of industry superannuation funds. Help using this website - Accessibility statement, raised their indicative takeover offer to $8.75 per share, Qantas wants Australians to be able to board international flights. Australias biggest fund, AustralianSuper, this week hit back at suggestions it exerts excessive influence on listed companies. But while believing most shareholders would accept a formal bid of $8.75 per share from the consortium, particularly short-term investors like hedge funds and arbitrage funds, Mr Clark said the airports long-term investors would miss out on an expected revival in flights due to pent-up demand for travel. Sydney Airport has stapled securities, which trade as if they were a single security. Evolution in our business context is taking many forms whether it be advancements in the aviation sector, technological disruption, climate change, changing consumption trends and passenger travel patterns, global health crises, changing employee preferences or community expectations. Sydney Airport had asked institutional investors for time, while the bidders wanted the investors to pressure the board to accept the bid. If successful, the purchase of Australia's biggest airport would be one of the country's largest-ever by enterprise value in U.S. dollar terms, on par with the $22 billion purchase of mall operator Westfield Group by Unibail-Rodamco in 2017, Refinitiv data showed. A shift to private ownership would benefit UniSuper because Sydney Airport would be de-listed, reducing costs, and it would no longer have to mark down the value of its investment when the airports stock tumbles, as it has during the pandemic. He has specialised in financial journalism for most of his career and covers equity and debt capital markets across Asia and Australian M&A. SYDNEY (Reuters) - A group of infrastructure investors has proposed a A$22.26 billion ($16.7 billion) buyout of Sydney Airport Holdings Pty Ltd, the operator of Australia's biggest. 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