Malaysian company set to buy rest of Istanbul airport
Sabiha Gökçen is Istanbul’s second-biggest airport located on the city's Asian side.Malaysia Airports Holdings (MAHB) has announced that it will acquire the remaining 40 percent stake in the Sabiha Gökçen International Airport (ISG), as well as the firm that operates services within the airport, LGM, giving it full control of Istanbul’s second-biggest airport.
“We will shortly sign a share purchase agreement to acquire Turkish firm Limak Group’s 40 percent of share interest in ISG and LGM for up to 285 million euros’ cash,” the company said.
The airport operator expects to complete the transaction by early 2015.
The company also said it was currently deliberating on the most appropriate funding structure for the acquisition and that further details on the proposed funding would be announced once finalized. It also gave assurance that the existing management structure of Sabiha Gökçen Airport would not change and that the airport would continue to be managed by the existing Turkish leadership team that will report to the ISG Board as usual.
“This acquisition gives MAHB access to an attractive offshore asset and will enhance MAHB’s presence in Turkey. Furthermore, it is testament to our confidence in the continued great performance of our Turkish management team in ISG and our commitment to this strategic investment,” said MAHB managing director Datuk Badlisham Ghazali in the statement.
“Going forward, we expect that the combined operations of ISG and LGM together with MAHB will be further enhanced,” he added.
MAHB, Limak and India’s GMR Group had first formed a 20-40-40 consortium in 2008 for the development of the green field airport, with the capacity to handle up to 25 million passengers per year. MAHB was the designated airport operator partner.
MAHB earlier this year increased its interest in ISG and LGM to 60 percent from 20 percent when it acquired a 40 percent stake from GMR for 225 million euros and obtained joint control with Limak Group.
Turkish TAV Airports were also interested in acquiring the 40 percent of the Sabiha Gökçen Airport and its operational services company, but the Malaysian company had the preemptive rights to buy the remainder of the units of the airport from Limak Group.
After the statement of MAHB, TAV Airports also announced it would not be a part of the transaction as long as the pre-notification of MAHB to acquire the shares in accordance with the laws by a written statement to the Public Disclosure Platform (KAP).
TAV Airports signed a share purchase agreement with Limak Group for the acquisition of 40 percent shares of Istanbul Sabiha Gökçen Airport on Sept. 15. If Malaysia Airports did not use its right of first refusal, they would begin making contributions to the operations at Sabiha Gökçen after receiving the required approvals, TAV said in a written statement last month.