More global airports up for sale

Mumbai: Airport privatisation programmes in several countries, particularly in eastern Europe and central Asia, are throwing up opportunities for Indian airport companies that are widening their areas of operation. The GMR group’s award to operate and build the Sabiha Goksen airport in Turkey may soon be followed by other similar cross-border deals.
According to the Centre for Asia Pacific Aviation, an aviation industry think-tank, about $60 billion investment funds is currently chasing airport assets as they become available. The value of an airport is traditionally measured by its Ebitda (Earnings before interest, taxes, depreciation and amortisation) and its sale price is measured as a multiple of the Ebitda.
Recently, airports have been changing hands on Ebitda multiples of up to 30 times, as was the case at Leeds Bradford, which was sold for 145.5 million pounds. Some airports like Hungary’s Budapest Airport have changed hands twice in the last two years, going for 1.5 billion pounds on the first occasion. Apart from traditional airport operators and construction companies, private equity players too have played a significant role in the M&A action at airports.
In India, the two private companies involved in airport modernisation, the GMR group and GVK, are looking to expand their business.
13/07/07 Cuckoo Paul/Economic Times

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Categories: Airports Jul 2007, Foreign Jul 2007, New Jul 2007