| TORONTO (May 17, 2007): Airport Group Investments Ltd. (AGIL), a limited company owned by the Ontario Teachers' Pension Plan (Teachers') and Victorian Funds Management Corp. (VFMC), has entered into a conditional agreement to acquire a 48.25% interest in Birmingham International Airport for £420 million ($918 million Cdn).
AGIL has agreed to acquire the shares indirectly and directly from Australia's Macquarie Airports Group Ltd. (Macquarie) and Aer Rianta International c.p.t, (Aer Rianta), a subsidiary company of the Dublin Airport Authority.
Birmingham International Airport, the fifth largest airport in the U.K., handles more than nine million passengers a year through two terminals, and acts as a gateway to Europe, North America, India and the Middle East.
West Midlands Districts Council (the Districts), which represents seven metropolitan areas in the airport's vicinity, owns a 49% interest in the airport and has pre-emption rights to the shares being sold by Macquarie and Aer Rianta. If the right is not exercised within 90 days, AGIL can close the transaction.
The Districts will retain their 49% interest in Birmingham Airport, while airport staff, through an employee share trust, will continue to hold the remaining 2.75%.
"This investment offers stable and attractive long-term returns that will help us pay pensions to the teachers of Ontario," said Jim Leech, Senior Vice-President, Teachers' Private Capital.
"We look forward to working with VFMC, the district co-shareholders and other stakeholders to support the continued development and growth of the airport over the coming decades."
Mr. Leech noted that a new runway extension, targeted for completion by 2012, will extend Birmingham's reach to international destinations.
Leo de Bever, Chief Investment Officer of VFMC, said: "We share the ambition of the Districts for the airport to be a major international gateway and recognize the key role of the airport in enhancing economic growth for the West Midlands region. As long-term public sector asset managers, we believe that Teachers' and ourselves are uniquely well suited to a long-term partnership with the district shareholders."
"In managing assets, VFMC considers investments that demonstrate appropriate risk and return characteristics that are suitable for its beneficiaries. As such, it is building a program of quality infrastructure assets of which Birmingham International Airport will be an important component. Birmingham International Airport is a good fit for VFMC. The entities bear a number of similarities, both having public sector stakeholders and operating within a commercial environment," said Mr. de Bever.
AGIL was formed by Teachers' and VFMC to hold their investment in Birmingham Airport. Teachers' owns 60.1% of AGIL, while VFMC owns 39.9%.
About Ontario Teachers' Pension Plan
The Ontario Teachers' Pension Plan is one of the largest public pension plans in Canada with $106 billion in net assets. An independent organization, it invests the pension fund's assets and administers the pensions of 271,000 active and retired teachers in Ontario. Its infrastructure group focuses on the acquisition and long-term retention of low-risk assets that generate stable returns linked to inflation. Teachers' has a diversified portfolio of global investments in public and private companies; government and corporate bonds; hedge funds; real estate; and inflation-sensitive investments that include infrastructure and timberlands.
About Victoria Funds Management Corporation
VFMC is based in Melbourne, Australia, and manages investments on behalf of Victorian Government entities, including pension funds, insurance funds and endowments for hospitals and universities within Victoria. VFMC was founded by an act of State Parliament and reports to the Treasurer of Victoria through the Department of Treasury and Finance. It currently manages assets totalling more than A$40 billion (£17 billion). The benefits of VFMC’s investment decisions effectively accrue to the citizens and employees of the State of Victoria.
Contact:
Debra Hanna
Manager, Pension Communications
Ontario Teachers' Pension Plan
416-730-5351
debra_hanna@otpp.com |
