New partner announced for Newcastle International Airport
Newcastle International Airport Ltd can announce today that its shareholders have selected AMP Capital as the new partner for a 49 per cent shareholding following a comprehensive selection process.
AMP Capital is a global investment manager and one of the most experienced global infrastructure managers with an exceptional track record in Australia, New Zealand, Asia, the United States and Europe. AMP Capital possesses relevant expertise through its involvement in Melbourne and Launceston Airports in Australia.
The majority 51 per cent shareholding will be retained by the seven North East local authorities – South Tyneside, Newcastle, Sunderland, Gateshead, Northumberland, Durham and North Tyneside – collectively known as LA7.
The Airport can also announce the completion of its refinancing project. The process has been carried out with its advisors RBC Capital Markets and KPMG and with support from the LA7 shareholders.
Financing is being provided by a new group of five banks – Royal Bank of Scotland, Royal Bank of Canada, Barclays Bank, HSH Nord Bank and National Australia Bank.
The new bank facilities will support the growth of the Airport and by significantly reducing the level of debt in the business will also reduce interest payments.
As part of the process, six of the LA7 local authorities (South Tyneside, Newcastle, Sunderland, Gateshead, Northumberland and Durham) will make a further investment in the Airport totalling £68million.
This investment will be at least revenue neutral based upon interest and dividends receivable from the Airport business in future years and any future returns paid will reflect the level of investment made by each individual authority.
Councillor Iain Malcolm, Leader of South Tyneside Council and Chairman of LA7, said: “The LA7 authorities are delighted that the preferred bidder for the 49 per cent shareholding has been selected.
“AMP Capital submitted an exceptional proposal and its involvement in running Melbourne and Launceston Airports in Australia will bring valuable airport experience. We’re delighted to have them on board and look forward to working with them to maximise the potential of the Airport.
“The completion of the refinancing is also great news for the region. The Airport is a major asset to the North East, generating millions of pounds for the local economy every year and supporting thousands of jobs.
“As a result we viewed the further investment by the local authorities as the right thing to do, not just for the Airport, but for the whole region.”
Boe Pahari, Managing Director for Europe, Head of Infrastructure, AMP Capital added: “Newcastle Airport is a high quality asset with excellent facilities used by more than 4.4million passengers per annum. The Airport already has the necessary infrastructure for further developing its commercial business and for meeting future demand for traffic growth.
“AMP Capital has long-standing experience investing in airports with its investment in Melbourne airport dating back to 1997. We look forward to working with the LA7 and Newcastle Airport management to add value and support the long-term growth and development of the Airport and the North East UK economy.”