Malaysia Airports to Raise Turkish Venture Stake to 60%

Malaysia Airports Holdings Bhd. (MAHB) said it plans to take majority control of its venture running Istanbul’s second-biggest airport, thwarting an investment in the facility by Turkish competitor TAV Havalimanlari Holding AS. (TAVHL)

Malaysia Airports agreed to raise its holding in Sabiha Gokcen International Airport AS to 60 percent by acquiring the 40 percent stake currently held by Indian partner GMR Infrastructure Ltd. (GMRI) for 225 million euros ($308 million), the Subang-based company said in a stock exchange filing today. Limak Holding AS, an Ankara-based builder, holds the remaining 40 percent.

Sabiha Gokcen, located on the Asian side of Istanbul, is the smaller of the two airports serving Turkey’s biggest city, handling 14.7 million passengers in 2012 compared with 45 million travelers using TAV’s Ataturk Airport. Limak, Bangalore-based GMR and Malaysia Airports bought operational rights to Sabiha Gokcen for 20 years from the Turkish government for 1.93 billion euros in 2007.

The Indian financial newspaper Economic Times, without saying where it got the information, reported on Dec. 13 that Istanbul-based TAV, an affiliate of Aeroports de Paris, reached an agreement to buy the GMR stake. Malaysia Airports said today that it’s exercising a right of first refusal to acquire the holding.

“This is negative for TAV,” Efe Kalkandelen, an analyst at Istanbul-based Is Investment, said in an e-mailed report.

Discount carrier Pegasus Airlines (PGSUS) is Sabiha Gokcen’s biggest user, with Turkish Airlines expanding service at the airport. Charter carriers also serve Sabiha Gokcen. GMR is selling its stake as it awaits a final decision on an operating contract for Mactan-Cebu Airport in the Philippines that’s scheduled to be awarded in January.

TAV fell as much as 3.9 percent and was trading down 1.8 percent at 13.90 liras at 5:29 p.m. in Istanbul, heading for the lowest closing price since Nov. 19.

To contact the reporter on this story: Ercan Ersoy in Istanbul at eersoy@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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