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BAA accepts Ferrovial-led bid

A passenger checks the monitors showing departing flights at London's Heathrow Airport Terminal 3 last month. PHOTO: AFP

British airport operator BAA PLC said yesterday it has accepted a £10 billion (US$19 billion) takeover bid from a consortium led by Ferrovial SA of Spain.

"The Board of BAA confirms that it has agreed, subject to final documentation, a revised definitive proposal from the Ferrovial Consortium valuing BAA at £9.5025 per share," the company said in an announcement to the London Stock Exchange.

The announcement came a day after BAA, which operates London's major airports, confirmed that it was in talks with Ferrovial and with another consortium.

Goldman Sachs confirmed yesterday that the rival consortium had tabled a bid of £9.5525 per share for BAA, including a declared final dividend of £1.525.

The Takeover Panel, an independent body that administers London's code on mergers and takeovers, yesterday had extended the deadline until June 16 for Ferrovial to announce a firm intention to make an offer for BAA or to walk away.

BAA -- which operates seven airports around Britain including London's Heathrow, Gatwick and Stansted -- last week rejected a £9 offer from Ferrovial as too low.

BAA shares were up 2.1 percent at £9.475 in morning trading on the London Stock Exchange, continuing a climb ignited by takeover speculation that has seen it gain some 45 percent since the beginning of the year.

The Goldman Sachs-led group made a preliminary offer of £8.8 a share last month, which BAA rejected. Britain's Competition Commission last week issued a "put up or shut up" order to the Goldman Sachs group, giving it a deadline of this Friday to come forward with an offer.

The Ferrovial consortium also includes Canadian investment fund Caisse de Depot et Placement du Quebec and Singapore government fund GIC.

BAA previously said that it believed its value was in excess of £9.4 per share.

The fight for BAA was further complicated last week when the government's Office of Fair Trading revealed that it is considering a full inquiry into the domestic airport market.

Such a probe would look at whether the current market structure, and BAA's dominance, delivers the best value for air travelers.

BAA owns and operates airports that handle 63 percent of travelers to and from Britain -- a figure that rises to 86 percent in Scotland and to 92 percent in London.
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