GIP: MAHB to benefit from higher investment, improved service levels, strong passenger growth after privatisation

Thursday 27 Jun 2024

KUALA LUMPUR (June 21): Global Infrastructure Partners (GIP) in the Gateway Development Alliance (GDA) is confident that Malaysia Airports Holdings Bhd (MAHB) (KL:AIRPORT) will benefit from higher investment, improved service levels and strong passenger growth.

GIP head of transport and GDA director Phil Iley noted that GIP acquired a stake in Signature Aviation in 2021, which owns and operates over 200 private aviation facilities across 27 countries, making it the largest fixed-base operator network in the world.

"The acquisition underscores our extensive experience in managing a global network of aviation assets," he told Bernama in a written reply.

To recap, the GDA and its shareholders had on May 15, 2024 announced a pre-conditional voluntary offer to acquire all the shares in MAHB not already owned by the consortium, at an offer price of RM11 per share, which is equivalent to RM18.4 billion.

The consortium is led by two Malaysian government-linked investment companies — Khazanah Nasional Bhd via its wholly owned subsidiary UEM Group Bhd, and the Employees Provident Fund (EPF).

Iley also highlighted GIP's decades of experience managing and operating airports through its investments in the Sydney Airport, London Gatwick Airport, Edinburgh Airport, Signature Aviation and previously London City Airport.

"All our airports have benefited from increased investment, improved service levels, reduced queue times for passengers, high-quality commercial outlets and strong passenger growth, and we are confident of achieving the same at MAHB.

"Airports are major enablers of economic activity, tourism and inward investment, and we are confident that an improved MAHB will drive growth in Malaysia to the benefit of both its economy and citizens," he said.

Iley emphasised that GIP and its partners are optimistic and committed to putting in the work to take MAHB to the next level.

They see excellent prospects for MAHB to regain its market position and improve its network connections, which have underperformed in recent years.

GIP to boost investments in KLIA, Penang, Langkawi, Kuching and Kota Kinabalu

To attract more tourism, he mentioned that aside from the Kuala Lumpur International Airport (KLIA), GIP plans to boost the number of flights and investment in the main regional airports of Penang, Langkawi, Kuching and Kota Kinabalu, as well as the Sabiha Gökçen International Airport in Istanbul.

As such, GIP needs to make long-term investment decisions with its partners to ensure that MAHB’s airports have sufficient capacity for decades to come.

“If we are successful with our transformation, we would very much consider relisting MAHB on Bursa Malaysia in future,” he said.

Regarding its shareholding in MAHB, Iley said that despite GIP being a minority shareholder, it expects to play the role of a technical partner in the GDA, and bring MAHB as much operational support and assistance as it needs.

"GIP is an equity investor, and we want to be fully aligned with our Malaysian partners in taking long-term investment decisions. We firmly believe that equity ownership is the best way to drive improvement in a business, as it best incentivises and aligns shareholders to contribute resources and expertise," he said.

On the relationship between GIP and the Abu Dhabi Investment Authority (ADIA), Iley said the Malaysian partners would own an effective 70% stake in MAHB, while GIP and ADIA would own the other 30% through GIP Aurea Pte Ltd.

The government of Malaysia will retain special share rights in MAHB.

GIP is reportedly a global firm with strong presence in 13 Asian countries, and has invested in and operated nationally significant infrastructure assets for over 18 years.

Currently, it manages US$112 billion (RM527.50 billion) in assets, and has invested in 41 companies that employ over 115,000 people.

Uploaded by Tham Yek Lee

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