Fraport begins Ljubljana Airport takeover talks

Fraport likely to take over Ljubljana Airport

Germany’s Fraport is to begin takeover talks for a 75.5% stake in Ljubljana Jože Pučnik Airport after the Slovenian government overturned an earlier decision to freeze the privatisation of state-owned companies. The state investment firm Slovenian Sovereign Holding (SDH), which is in charge of selling state assets, said yesterday it would start exclusive talks over Ljubljana Airport with Fraport, which is a multi billion euro management and transport company. Talks with the German conglomerate will continue “for a limited time”, according to SDH, which added that Fraport was the highest bidder. The sale of Slovenia’s busiest airport is now expected to be completed this autumn.

The only other interested party which publicly revealed its intention to bid for a majority share in Ljubljana Airport was France’s Vinci, which was willing to invest fifty euros per share, or a total of 96.7 million euros. Fraport’s offer is believed to have eclipsed this figure. Several companies are reported to have pulled out of the bidding process after the Slovenian government temporarily halted all privatisations in the country last month in the lead-up to snap parliamentary elections. Besides Fraport and Vinci, Friedmann Pacific Investment Holdings from Hong Kong and Italy’s SAVE are also believed to have placed bids. Initially, twenty companies expressed interest in participating in the privatisation process.

Fraport, officially known as Frankfurt Airport Services Worldwide, manages Europe’s third busiest airport - Frankfurt. In addition, the company also runs several major airports across the world including Cairo, Delhi, Hanover, Pulkovo Airport in Saint Petersburg and Jeddah in Saudi Arabia. In addition, Fraport also runs the main international airports in Varna and Burgas in Bulgaria, Lima in Peru, Xi’an in China, Antalya in Turkey and the new airport in Dakar in Senegal, which is currently under construction. The company boasts some 20.000 employees and in 2013 generated revenue of 2.6 billion euros. Fraport will have to address the issue of building a new passenger terminal at Ljubljana Airport. Late last year, the airport’s minority shareholders, mostly made up of banks, rejected plans for the construction of a new terminal, which was pitched by the state.

Foreign ownership and airport concession contracts are becoming common in the former Yugoslavia. Zagreb Airport is managed by a consortium led by France’s Aéroports de Paris while Pristina Airport is run by the Franco-Turkish consortium headed by Istanbul-based Limak Holding. Macedonia’s Skopje and Ohrid airports are managed by Turkey’s TAV Holdings while Belgrade Airport will also be put up for concession in the foreseeable future.