Sydney Airport has again rejected a takeover offer from a group of local and offshore superannuation investors.
It is the second bid the Covid-hit airport company has rejected – this one was a mere 20 cents a share higher.
Sydney Airport told the ASX on Monday morning that the group of super fund investors had raised the non-binding bid they made last month for the country’s largest airport from $8.25 a share to $8.45 a share.
The largest super fund in the country, AustralianSuper, has also joined the bidding consortium.
Sydney Airport said aside from the higher price, the terms of the offer were the same as last month’s initial proposal, which said the bid would require the airport board’s approval to succeed (thereby allowing the offer not be the called for what it is in reality – an unwanted hostile bid).
Sydney Airport’s board said its view of the airport’s long-term value remained unchanged – that the bid was ‘opportunistic’ and still undervalued Sydney Airport.
“Sydney Airport remains strongly positioned, has strengthened its balance sheet and tightly managed costs to maintain flexibility to respond to a range of recovery scenarios and to pursue sensible growth opportunities as the recovery unfolds,” the David Gonski-chaired company said in Monday’s ASX statement.
The company had previously pointed out the offer is below Sydney Airport’s pre-COVID highs, which were close to $9 a share.
“The boards are open to engaging with the Sydney Aviation Alliance should the Consortium be prepared to lift its indicative price to appropriately recognise long-term value for Sydney Airport Securityholders,” the company said.
The bidders know that a price around $8.70 a share (cash) would have probably won the board’s blessing, but the bidders also know that the continuing Covid lockdowns here and around the world because of the rise of the Delta variant means re-opening Australia’s borders and restoring value of Sydney Airport, will take a lot longer than they were thinking earlier this year.
