In a surprise announcement, the Public Investment Corporation (PIC) says it will pay R1,67-billion for the 20% stake in Airports Company South Africa (Acsa) previously held by international airports company ADR.
Acsa’s annual results released last week showed profits before tax up 22% to R593,2-million.
The PIC is government-owned and manages funds on behalf of government employees. The stake is being purchased on behalf of the Government Employees Pension Fund (GEPF).
PIC spokesperson Mukoni Rat-shitanga says it is very satisfied with the price paid for the 20% stake and that Acsa’s good returns and positive long-term growth prospects made it an attractive investment.
“We think Acsa offers a lot of value for our client GEPF, on whose behalf we purchased the stake,” said Ratshitanga.
The announcement by the PIC is a surprise as Tokyo Sexwale’s Mvela-phanda was reported to be the most likely contender for the 20% stake. Ratshitanga says he was not aware what Mvelaphanda bid for the stake or even if it did make a bid.
ADR’s decision to sell the stake, which it bought for R819-million in 1998, sees the exit from Acsa of its foreign partner.
The Rome-headquartered inter-national operator of airports is showing a handsome R851-million profit from its decision to invest in Acsa.
ADR also had an option to buy a further 10% of Acsa in terms of the original deal. This was to be at the same price. One observer says ADR will not be taking up the option. ADR’s decision to exit Acsa follows a board decision to sell its non-core investments.
Acsa, which owns and operates South Africa’s nine principal airports, is the largest airports company in Africa. Together, Acsa-operated airports handle more than 400 000 aircraft movements and more than 24-million passengers annually.
Annual results released last week showed that four of South Africa’s airports were unprofitable. Bloemfontein airport lost R2,1-million, Kimberley R2,6-million, Upington R2,7-million and Pilanesburg R3,5-million.