(Adds comment from pension plan)
LONDON/TORONTO, July 28 Canada's Ontario
Teachers' Pension Plan wants to increase its stake in Britain's
Bristol Airport from the current 49 percent as Australian asset
manager Macquarie Group is reportedly seeking a buyer
for its 50 percent stake.
"We plan to increase our ownership, and in fact, we feel
that we are the right buyer, given our history and expertise.
Bristol Airport is an asset in which we already hold a
significant stake, so we know and understand it well," Deborah
Allan, the pension fund's spokeswoman, said in an email to
The deal is worth up to 250 million pounds ($424.6 million),
a source who is closely monitoring the situation said on Monday.
The pension fund has the right of first offer for the
50-percent stake owned by Macquarie, the world's largest
infrastructure asset manager, which was sounding out buyers for
its holding, British newspaper The Sunday Times reported.
Ontario Teachers' Pension Plan is eyeing the stake as it
seeks to expand its infrastructure holdings from $12 billion to
around $18 billion. The deal could take place this year, the
"Given the right of first offer, Ontario Teachers is likely
to purchase the stake, but this will of course be based on an
appropriate valuation," the source said, adding that discussions
have not commenced but are expected to start "very soon."
European airport deals typically attract a valuation of
15-17 times core earnings, or EBITDA.
"It's in a geography we know and like, and we have a
well-established airport investment team with sector expertise
and excellent relationships," Allan said.
Macquarie, Australia's top investment bank, holds its stake
in Bristol Airport - the UK's ninth-busiest - as part of its
2004 Macquarie European Infrastructure Fund (MEIF). The company
was not immediately available for comment. Sydney Airport holds
the remaining 1 percent.
Ontario Teachers, which also has a stake in Birmingham
Airport, originally invested in Bristol Airport in 2002 and
increased its stake in 2009. Bristol Airport posted a pretax
profit of 25.8 million pounds in 2013.
The 1.5-billion-euro MEIF is coming to the end of its life
cycle, so Macquarie will either have to sell its holdings and
return money to investors or seek their permission to roll them
over into its second or third infrastructure funds.
The MEIF sold its holding in Sweden's Arlanda Express
high-speed rail service in July, after putting it up for sale in
2013. The company also has stakes in UK ferry company Wightlink
Shipping and Brussels Airport.
($1 = 0.5888 British pounds)
(Reporting By Freya Berry in London and Andrea Hopkins in
Toronto; Editing by Lisa Jucca, G Crosse and Erica Billingham)