Macquarie Infrastructure and Real Assets is set to call for indicative bids in June following the expected release of an information memorandum for the sale of its 50.01% share of Hobart Airport.
Potential bidders will have until July to lodge indicative bids before the final bid phase starts between July and August, with final bids due in September or October, according to a flier sent out in recent days seen by Inframation.
The stake is held by Macquarie Global Infrastructure Fund III, a closed ended fund due to mature in September.
A large number of infrastructure investors are expected to be interested in buying Hobart Airport and had early stage talks with MIRA’s adviser, Credit Suisse, before the flier was released. Two of the investors told Inframation they were waiting on the IM to get a detailed picture of the business and its prospects.
The sources said they had been told MIRA’s partner in the airport, 49.9% owner Tasplan, has waived its pre-emption rights, meaning it will not compete to buy the MIRA shareholding. The super fund is instead considering whether to sell some of its stake. It is likely bidders will be informed whether there is more of the airport on offer after indicative bids have been lodged.
The IM will be accompanied by some vendor due diligence reports and further detail on the operating financial model for the airport.
Those chosen to lodge final bids will receive more vendor supplied independent due diligence, including potential for “non-aero” business lines, such as retail opportunities, capital and operating expenditure and a review of land use, lease income and precinct development opportunities.
The flier said EBITDA for the airport’s 2018 financial year to 30 June was AUD 33m, which it said had grown from AUD 16m in 2007 before MIRA bought its share, a compound annual growth rate of about 7.6%.
Passenger numbers have risen from 1.8m to 2.6m in that time.
Total debt facilities were AUD 195m, with AUD 20m of that undrawn, with cash on hand of AUD 18m.
Hobart Airport was privatised by the federal government in 1998 under a 99-year land lease. That is made up of a 50 year lease to 2048, with an option to extend for another 49 years to 2097.
The flier talks of significant growth plans to support international flights that last year’s extension of its runway will allow, including direct flights to New Zealand and Asia as well as one stop flights to Europe and North America.
Between now and 2026, as well as adding the customs capabilities to accept international arrivals and departures, the airport is planning to spend on adding bigger and refurbished departure lounges, including space for more retail outlets and bigger baggage handling facilities.
It is also establishing a freight “precinct” to allow, among other things, fresh produce from Tasmania to be exported directly overseas.
Advisers and interested buyers said the sale will attract both mid sized GPs and LPs that may want to invest directly. So far, QIC has retained UBS and UniSuper has Macquarie Capital advising them.
Others interested include AMP Capital, Infrastructure Capital Group, Palisade, IFM Investors, OPTrust and Ferrovial, according to sources familiar and close.