QIA snaps up 24.9% in St Petersburg airport shares
The deal will help offset weakening revenues at travel hubs like Frankfurt and Antalya and will assist it to reach its 2016 earnings forecast
Qatar Investment Authority (QIA) has scooped up shares in German group Fraport’s ailing St Petersburg airport.
QIA has bought operator shares in St Petersburg airport, which is suffering from low traveller numbers on the back of the flailing Russian rouble and regional unrest.
Germany’s Fraport expects to gain between $34-45m in the deal.
The group outlined on 31 July, that it anticipated the deal will help offset weakening revenues at travel hubs like Frankfurt and Antalya and will assist it to reach its 2016 earnings forecast.
Ongoing political upheaval in the region such as attacks in Europe and a failed coup in Turkey have impacted travel, pressuring easyJet, Lufthansa , Air France-KLM and IAG to emphasise security concerns.
A one percent drop in passenger numbers in the first six months was witnessed by Fraport’s home base Frankfurt, while its Turkish outlet Antalya, was down 30% in the wake of a spree of recent suicide bombings in the country.
French peer Groupe ADP reported lower revenues in the first six months.
Ukraine and Russia’s political instability over the last two years sparked a dramatic fall in the rouble by almost half, severely damaging passenger numbers and retail spending at the St Petersburg airport, where traffic was down 6.5% in the first half of the year.
“Despite the current difficulties in Russia, we continue to regard this as an attractive market,” Fraport chief executive Stefan Schulte said in a statement.
Fraport revealed that it is lowering its stake in Thalita Trading, the parent company of Northern Capital Gateway, which holds the concession to operate the Pulkovo Airport in St Petersburg, from 35.5% to 25%.
QIA's stake will sit at 24.9% in total, as consortium partner Copelouzos Group is also selling shares.
The weakening rouble has financially affected St Petersburg airport’s operating company, which had recently financed new terminal buildings in euros and dollars, forcing Fraport to help resolve the situation.
Fraport has informed that it will also sell some loans provided to Thalita Trading.