Macquarie Bank: Indian airports likely assets for investments
12 Jun 2007
Regulatory frameworks, flexibility to raise capital and exit options were all important considerations in an infrastructure sector where intense competition has pushed prices up around the world, Ambalika Banerji, an associate director at Macquarie Bank, told an aviation conference in Mumbai.
"There's a significant pool of equity chasing a limited supply of airport assets globally, and investors are paying a huge premium for control," she said.
"Demand for airport assets is at an all-time high, and airport trading and transaction multiples are going up very quickly."
Speakers at the conference, organised by the Centre for Asia-Pacific Aviation, estimated the average transaction EBITDA multiple for a controlling stake in a regulated airport was 19.5 in the years 2000 to 2006, up from 15.8 before the year 2000.
The average transaction EBITDA multiple for a controlling stake in a non-regulated airport was 20.5 in 2000 to 2006, up from 11.8 beforehand.
There were about 60 active and potential buyers worldwide, holding about $50-$150 billion for airport assets, the conference was told.
In India, the government, in partnership with domestic and international firms, is modernising ageing airports and building new ones to support the rapid growth in aviation.
According to Banerji, Macquarie was interested in making investments and would even consider a Greenfield opportunity. "Most - if not all - our investments to date have been brownfield, and that would be more comforting, but a greenfield has its own pluses," she said.