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Heathrow owner Ferrovial is exploring stake options in Britain’s biggest airport: sources

LONDON: Spain’s Ferrovial is exploring options for its 25% stake in London’s Heathrow, two sources told Reuters, and has held preliminary talks with outside advisers about the future of its stake in London’s biggest airport Britain.

The early talks come amid interest in Ferrovial’s stake from private equity firm Ardian, which has held talks with its own advisers on a possible joint proposal with Saudi Arabia’s Public Investment Fund, said those sources and another person familiar with the matter.

Ferrovial has yet to make a final decision and talks may not lead to a sale, all sources said.

HIGHLIGHTS

Heathrow is worth around 24.3 billion euros ($25 billion), including debt.

Qatar Investment Authority, which has a 20% stake in Heathrow, is the second largest investor in the busy British airport.

Shares of the Madrid-listed company rose 4.2% according to the Reuters report. By market close, they were up 3.7%, marking their second-best day in five months and making them the third-best performing stock on the pan-European STOXX 600 index.

Ferrovial and Ardian both declined to comment while PIF did not immediately respond to a request for comment.

Heathrow is worth around 24.3 billion euros ($25 billion) including debt, JPMorgan analysts calculated in May. According to JPMorgan estimates, Ferrovial’s stake in Heathrow has a net worth of 611 million euros.

But Insight Investment Research analyst Robert Crimes took a less conservative view and told Reuters the equity value of Ferrovial’s 25% stake in Heathrow could be close to €2 billion, although above the consensus of analysts. He said Ferrovial’s shares had yet to reflect the post-pandemic recovery in traffic volumes and inflation-linked returns.

Heathrow, which aeronautical data firm OAG said was the world’s fifth-busiest airport in July, has been hit hard by coronavirus closures but raised its traffic forecast for 2022 to 54.4 million passengers in June after a rebound in travel.

Last month, Heathrow, like some other airports in Europe, asked airlines to stop selling tickets for summer departures and to limit the number of passengers to limit queues, baggage delays and cancellations as it battled pent-up demand.

Madrid-based Ferrovial, which controls Spanish transport infrastructure developer Cintra and has stakes in highways in the United States and Canada, has invested in Heathrow Airport for 16 years and ranks as its most great investor.

The Qatar Investment Authority, which has a 20% stake in Heathrow, is the second largest investor in the busy British airport, while Caisse de depot et placement du Quebec, Singapore wealth fund GIC and China Investment Corp. also hold significant stakes.

QIA declined to comment while CDPQ, GIC and China Investment Corp. were not immediately available.

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