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Canadian fund Pension Plan Investment Board discloses details of its bid for Auckland International Airport

19 Sep 2007

1

Canadian pension fund Canada Pension Plan Investment Board (CPPIB) confirmed Wednesday 19 September that it would make a bid for a major stake in Auckland International Airport Ltd (AIAL), the company that owns Auckland airport, New Zealand's air transport hub.

CPPIB said its bid could value AIAL at up to NZ$4.76 billion ($3.45 billion). It said it would discuss its bid for a significant minority stake with the AIAL board on Thursday. Earlier this month, the pension fund had said it would seek up to 49-per cent of the airport.

Disclosing the details of its bid for the first time, CPPIB said it would offer NZ$3.70 ($2.63) a share in an all-cash offer. Two other options, involving a combination of cash and new securities, could value AIAL at up to NZ$3.90 ($2.77) a share, it said.

Earlier this year, AIAL had turned down the pension fund's offer of NZ$3.10 ($2.20) a share, when CPPIB had approached key shareholders with an offer to buy at that price.

Dubai Aerospace Enterprise (DAE) earlier this month abandoned its controversial bid to take a majority stake in the face of widespread opposition to 'foreign control' of the airport. The United Arab Emirates (UAE)-based aerospace and aviation company had offered to take a stake of between 51 and 60 per cent for up to NZ$2.6 billion ($1.85 billion).

CPPIB handles investments for the Canada Pension Plan, which has 16 million members and gross assets of C$120.5 billion ($118.9 billion). It had said its bid would preserve substantial levels of local ownership of the airport, which handles 70 per cent of international arrivals in New Zealand.

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