Macquarie Airports to Cut Away

Submitted by Jim Thesiger on 24 July, 2009 - 04:43

Another Satellite fund of the Macquarie Group, Macquarie Airports (MAP) is most likely to be the next in the line to cut away from the parent company as the group moves forward with its plan to give more focus in the investment banking. On Thursday, Macquarie Airports fund issued a notice for an imminent change and requested for a close down of trading. The MAp authority mentioned that it is about to come up with a declaration regarding the strategic options in two days in order to boost up the security holder value. It was followed by a request from its parent Macquarie Group which asked to suspend the MAp shares. The suspension ignited the speculation that the deals regarding MAp could affect the revenue of Macquarie Group directly.

The investment bank slashed $1 billion from the value of its two prime real estate office trusts in response to a revaluation at the end of the financial year just before the MAp alerts was issued yesterday. Macquarie Communications was sold recently by Macquarie and it also took initiatives to internationalise the management rights of Macquarie Leisure Trust, another listed arm of the Macquarie Group. The MCG sale created the buzz among analysts that Macquarie might let go MAp and would sacrifice the profitable management fee stream. It is to be mentioned that Macquarie owns 22.1 percent stake of MAp worth of $1.1 billion and also receives management fee from the fund annually which is worth of $400 million.

Speculation was in the market on Thursday that Macquarie Airports might consider selling its Copenhagen or Brussels airports. However, some other observers suggested that in order to pay off the debt, 74 percent of the Sydney Airport stake could be offloaded on the basis of emergency bid. In the stock exchange, the Macquarie Group and MAp stock prices were at a stable condition in last few weeks. Stock price of the bank went up touching the $41.80 mark where in March it remained as low as $15.75. Ahead of the halt in trading, MAp stocks were 10 percent up to $2.64.