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London / Bloomberg
China’s HNA Group and a consortium led by Ontario Teachers’ Pension Plan Board and Borealis Infrastructure are in the lead to buy London City Airport from its US owners, people familiar with the matter said.
The central London airport, owned by Global Infrastructure Partners, could fetch more than 2 billion pounds ($2.8 billion), the people said, asking not to be named because the talks are private. The companies have been asked to submit another round of bids Wednesday, and GIP hasn’t chosen a winner, two of the people said. Cheung Kong Infrastructure Holdings Ltd. is also still interested in bidding, they said.
The airport, located about 6 miles (10 kilometers) from London’s financial district and opened in 1987, was acquired by American International Group Inc. and GIP in 2006. At the time, news reports said that the companies agreed to pay 750 million pounds, though terms weren’t disclosed. Two years later, American International sold its stake to GIP and Highstar Capital, which now owns 25 percent.
Any deal would add to the $22.7 billion of airport-related acquisitions over the past 12 months, according to data compiled by Bloomberg. Spokesmen for GIP, PSP and Borealis declined to comment. Representatives for Ontario Teachers’ and CKI didn’t immediately respond to requests for comment, while a media representative for HNA said she couldn’t immediately comment.
The winning bidder will have to come to terms with a political conflict that stands in the way of a planned
expansion that would help City serve 6.5 million
passengers a year by 2023.