A deal between Australian infrastructure giant Macquarie and Ontario Teachers’ Pension Plan (OTPP) to acquire stakes in London City, Birmingham and Bristol airports is reported to be “close to an agreement”.
OTPP first announced plans to offload its stake in the three airports late last year, but according to a report in The Times sources say the deal is now expected to close imminently, although there is no certainty. Neither Macquarie or OTPP has commented so far.
OTPP currently owns 27 per cent of Birmingham, 55 per cent of Bristol and 25 per cent of London City.
It was announced on Friday that the two other airports, Brussels and Copenhagen, that were included in OTPP’s original sale were sold to Flemish public investment company Participatie-Maatschappij Vlaanderen and Danish pension fund and incumbent co-investor, Arbejdsmarkedets Tillaegspension respectively.
The combined value of the five airports in OTPP’s portfolio had previously been estimated at around GBP10 billion. The interest from Macquarie signals a market that is ripe for consolidation according to financial analysts.
While the Australian investor works to finalise terms with OTPP, The Times reports that the deal remains highly complex, in part due to Birmingham being co-owned by the city’s council, which declared bankruptcy in late 2023.
UK airport market presents opportunity for foreign investment
OTPP’s decision to sell its stakes in the three UK airports follows the sale of several other UK airports over the last year.
In November 2024, AviAlliance acquired AGS Airports, which owns and operates Aberdeen, Glasgow and Southampton airports. In June, French firm Vinci acquired a majority stake (50.1 per cent) in Edinburgh, while Ferrovial sold its majority stake in London Heathrow earlier in the year to French investor Ardian and Saudi Arabia’s Public Investment Fund.
Trio of UK hubs:
Birmingham is the UK’s seventh largest airport welcoming 12.8 million passengers last year. It recently announced a GBP 230 million refinancing plan to increase capacity to 18 million passengers per year. Bristol is the UK’s eighth largest airport, welcoming over 10 million passengers in 2024 (a 7 per cent increase compared to 2023). easyJet has 19 aircraft currently based at the airport, which is currently consulting on a Masterplan to 2040 outlining growth plans that would see new connections to North America and the Middle East. London City, which welcomed 3.6 million passengers last year, but was recently granted permission to increase passenger numbers from 6.5 million annually to 9 million. It was however denied the opportunity to extend its Saturday operating hours.
