After sweetening its takeover offer to A$23.6 billion ($17.4 billion), an infrastructure investor group was granted permission to perform due diligence on Sydney Airport Holdings Pt Ltd on Monday, bringing the sale of Australia’s largest airport one step closer.
The proposal boosted the airport’s stock by 5%, with analysts predicting that a rival bid would be unlikely given the size of the capital required and foreign ownership regulations that require the airport to be 51 percent controlled by Australians.
In a note, Credit Suisse analysts wrote, “We attribute a high probability of a deal completing given the board’s pledge to unanimously support the (consortium’s) offer if there is no alternative higher offer.”
Sydney Airport is the country’s sole publicly traded airport, and a purchase would be a long-term investment on the travel industry, which has been hit hard by the pandemic. Once 80 percent of adults are properly vaccinated, which is expected by the end of the year, the government wants to gradually open its borders.