Dubai Aerospace buys control of Auckland Airport
Dubai Aerospace Enterprise (DAE) will acquire a controlling interest in Auckland International Airport, New Zealand's biggest aviation hub, under a proposed deal announced on Monday.
The directors of Auckland International Airport Limited (AIAL) said they unanimously recommended acceptance of DAE's offer, worth 2.6 billion New Zealand dollars (about $2 billion), which would give it 51 to 60 per cent of the company.
DAE will pay AIAL shareholders up to 3.80 New Zealand dollars a share in cash and securities, 49 New Zealand cents higher than Friday's closing price on the New Zealand Stock Exchange and a premium of 55.9 per cent on the average trading price over the month prior to May 5, when takeover speculation began.
Directors said the offer valued AIAL at 5.6 billion New Zealand dollars.
Speculation about a takeover was sparked when the Canada Pension Plan Investment Board offered the company's two biggest shareholders the Auckland and Manukau city councils 3.10 New Zealand dollars a share for their 22.27 per cent holding.
The councils had been considering selling their shares because returns had been below expectations.
The directors said they recommended acceptance of the DAE deal in the absence of a superior proposal, but the merger agreement allows them to opt out and accept a better offer should one materialise.
Shareholders will vote on the proposal in November.
John Maasland, chairman of AIAL, said that DAE was a global aerospace manufacturing and services corporation that was seeking to become a major player in the international aerospace industry.
"We believe DAE will bring additional aviation and tourism development experience to the New Zealand business," he said. "This partnership should deliver significant benefits to the company and New Zealand tourism as a whole."
The deal is subject to acceptance by 75 per cent of shareholders and approval of the Overseas Investment Office.