Ferrovial in bid to buy BAA

[Twitcher]

Spanish construction group Ferrovial has launched a hostile £8.75bn all-cash bid for UK airports group BAA.
The offer is the same price that BAA rejected from Ferrovial on 17 March, saying it undervalued the firm.

BAA owns seven airports across the country including London's Heathrow, Gatwick and Stansted.

The UK Takeover Panel had given Ferrovial until 24 April to make a formal bid for BAA or walk away from any deal for six months.

Ferrovial's offer represents 810p per share.

BAA, the UK's largest airports operator, also owns Southampton, Glasgow, Edinburgh and Aberdeen.

'Keen to talk'

The Spanish firm is making the hostile bid at the head of a consortium that also includes Canadian investment fund Caisse de Depot et Placement du Quebec, and Singapore government fund GIC.
"Whilst this bid is being made unilaterally, we do not regard it as hostile," said Ferrovial chairman Rafael del Pino.

"We remain keen to engage in a dialogue with the BAA board with a view to securing a recommendation for the consortium's offers."

No-one from BAA was immediately available.

Ferrovial said that debt financing for the proposed takeover had come from Citigroup, Royal Bank of Scotland, Santander, HSBC and Calyon.

It added that it was committed to "safe long-term funding" in the bond markets, and planned to consult with BAA's existing bondholders to help develop its long-term funding plans.

SOURCE:http://news.bbc.co.uk/1/hi/business/4888190.stm

[kuningan]

No surprise, BAA have told them to Foxtrot Oscar......

http://tinyurl.com/lwpcz

[tristar500]

Lets get it over and done with. BAA should take the money and run. Rumour has it that some of the airports would be sold off if Ferrovial took over - great. Maybe smaller airports like EDI would prosper under a new owner, willing to invest properly - not a small investment here and ther every 4 or 5 years... EDI is at breaking point from all angles and its poor planning from the bigwigs thats to blame. Severe shortage of checkin desks, security search facilities, boarding gates and aircraft parking. Aircraft are to be parked at the cargo terminal this summer, and pax bussed to the terminal... In fact EDI only just took delivery last month of 2 x ambilift vehicles capable serving any aircraft at EDI for the assistance of disabled pax. The previous vehicle couldnt fit onto smaller aircraft and it was almost 20 years old. The vehicle was only replaced after a serious of very embarassing incidents involving SAAB and Embraer aircraft, including one where an air ambulance helicopter had to be brought in to take a pax to Stornoway... EDI has had the largest increase again in pax this year so far, and all we get is a simple terminal extension not even as long as the area its going to serve. Nevermind, Iam sure T5 is grateful of the additional income EDI is making.
Look at MAN and BHX. Those guys saw the demand, and acted on it. Now they are reaping the rewards. I take my hat off to their managers and planners for taking the initiative to build facilities fit for passengers and additional capacity well into the millenium - at least.
So I say come on Ferrovial (or any other serious interested party) Go for it. :ok:

[Coasthugger]

I think that if you think BAA underinvests then you'd get a rude shock from the attitude at, say, MAG. How much have BAA piled into Southampton? I think the website quotes a total investment of £28m... all for a 2m-pax airport that still can't handle anything bigger than a 737.

2 things - Firstly I don't think you can judge Ferrovial by what has happened at BRS. Developing a regional airport is very different from milking the cash cow that is Heathrow. I don't think Ferrovial will be more likely to spend than BAA.

Secondly, I suspect that the smaller BAA airports would find life harder, rather than easier, under independent ownership.

[tristar500]

Let me say from experience in working at EDI for the last 18 and a half years, the BAA dont plan far enough or invest far enough ahead and when 'investment' is done, its on such a small scale that by the time its ready, yet more is needed. For the capital city airport of Scotland, it is a joke. Everything is being invested at LHR and T5. Its no big secret. A private investor would certainly want a return for their money, but they would appreciate that to get that return, investment is needed. The BAA have 7 airports in the UK, so I can appreciate that to heavily invest in them all would be impossible, so sell the ones you dont want. Dont hang onto them and cap them at levels well under their potential! EDI has massive potential, and is being held back. Let a private firm take over and do what is right.:)

[Joe Curry]

EDI has massive potential, and is being held back. Let a private firm take over and do what is right.:)
Good luck with this Tristar500... I have been arguing this
for 30 years.. :sad:
Hopefully the proposed UK-wide rail link at EDI will
change some agendas :ok:
http://edinburghnews.scotsman.com/edinburgh.cfm?id=565742006

[Re-Heat]

BAA rejects £9.4bn Goldman bid
By Thomas Catan in London
Published: April 16 2006 18:42 | Last updated: April 16 2006 18:42

BAA, the target of a hostile takeover bid by Ferrovial, the Spanish infrastructure group, said on Sunday it had rejected a friendly approach by a consortium led by Goldman Sachs that valued the British airports operator at £9.4bn ($16.4bn).

BAA said it had received a “preliminary, highly conditional and confidential approach” from a consortium including Goldman Sachs on March 30 to make a cash offer at a price of 870p per share. BAA had rebuffed the offer, claiming it did not reflect the “true value” of the company.

It was not immediately clear whether the consortium headed by Goldman Sachs would sweeten its offer for BAA, which is being targeted by several rival consortia of private equity groups and infrastructure funds. BAA said that the Goldman consortium had not been in touch since the approach.

Goldman Sachs declined to comment on the bid. Consortiums led by the investment bank have recently failed in bids for several companies, including ITV, the UK television group and Associated Port Holdings, the UK port operator.

Ferrovial has offered 810p per share for BAA, valuing the company at £8.75bn, but analysts believe it will have to significantly raise its bid to be successful. Some investors are holding out for an offer of 900p a share, and BAA maintains the offer on the table does “not begin to reflect the true value” of the company’s assets.

The Spanish group initially said it was prepared to increase its bid “by a small increment” if certain conditions were met. It surprised the market by reiterating its bid of 810p a share, well below the price many leading shareholders are prepared to accept.

BAA controls seven airports in the UK including the three regulated London airports – Heathrow, Gatwick and Stansted – and has airport interests in Australia, Italy, Hungary and the US. In the US, it manages Indianapolis airport a s well as retail facilities at Baltimore, Pittsburgh and Boston airports.

Ferrovial has a 60 per cent stake in the bidding consortium, which includes Caisse de Dépôt et Placement du Quebec (CDP), a Canadian financial institution, and GIC Special Investments, the private equity arm of the Government of Singapore Investment Corporation.

Ferrovial is being advised by Citigroup; BAA by Rothschild and UBS. HSBC is advising CDP.

[GoEDI]

Aircraft are to be parked at the cargo terminal this summer, and pax bussed to the terminal...

Where did you get this from? I don't believe it for a second. Not least because there is no room over there either and the fact that it is logistically mad, even for BAA!

[tristar500]

GoEDI

Let me remind you that R/WAY 12-30 is used as a parking area anyway throughtout the year, again, restricting the use of said runway - what a great idea - NOT. The eastern apron at EDI will be used (including the parking adjacent to the old RAF hangar) to accommodate flights with pax being bussed over to the terminal. Freight and cargo aircraft will be re-positioned to appropriate temporary parking areas during the day to make way for these flights.:8

[GoEDI]

I'll believe it when I see it.;)