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Bridgepoint triples money on Birmingham Airport

Bridgepoint Capital has made three times its money on the sale of its stake in Birmingham Airport to Macquarie Airports Group. This is Bridgepoint Capital’s thirteenth exit this year. The European buyout house has agreed to sell a 24.1 per cent stake in Birmingham Airport. The sale is worth GBP84 million to Bridgepoint. The transaction is expected to complete before the end of the year.

Bridgepoint acquired its stake in Birmingham Airport in 1997 alongside Aer Rianta, the Irish government-owned airport authority. The investors paid GBP42 million for a 40 per cent stake in the airport. Last year Aer Rianta and Bridgepoint increased their investment to 48.25 per cent, bringing Bridgepoint’s total commitment to E50 million. Aer Rianta continues to hold 24.1 per cent of the company, other shareholders include the seven district councils in the West Midlands (49 per cent) and the Employee Share Ownership Trust (2.75 per cent).

The original investment was part of a ten-year, GBP260 million investment and development programme for Birmingham airport, the fifth largest in the UK. To date GBP150 million has been spent. In the year to March 2001 7.6 million passengers used the airport, which is forecast to reach a ten million-passenger capacity by 2005. The airport’s customers are generally UK nationals on short to medium haul flights, meaning it has suffered only a five per cent drop, compared to last year, in the level of traffic following the US terrorist attacks.

The buyer, Macquarie Airports Group, is a private equity fund, which intends to be a long-term shareholder. A subsidiary of Australian investment banking and advisory group, Macquaire Bank, the fund was established this August and has so far raised E365 million towards a E600 million total. Primarily, it will invest in unlisted airports and associated infrastructure in the UK and Western Europe. The fund’s first investment was a 50 per cent stake in Bristol International Airport. Anthony Kahn, chairman of the group, said the European aviation sector represented very good prospects for investors looking for attractive growth infrastructure opportunities.

Hawkpoint Partners is advising Bridgepoint and Macquarie Airports Group is being advised by Macquarie’s corporate and structured finance division.