Macquarie digs deep for AB Ports

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The Independent Online

Britannia Ports, the Australian consortium headed by Macquarie Bank, is to make a renewed attempt to steal AB Ports from the clutches of Goldman Sachs this week, trumping the investment bank's agreed offer with a £2.7bn bid for the group.

AB Ports accepted an 810p a share offer from Admiral, the Goldman-backed consortium, last week. Admiral was then forced to raise its bid by another 30p a share, when Macquarie offered the ports operator 840p.

But Macquarie, which is working with 3i and a Canadian pension fund, is poised to raise its bid again to about 865p a share, valuing the company at almost £2.7bn.

Speculation that more bidders may emerge heightened over the weekend. Cheung Kong Infrastructure Holdings (CKI) - a Hong Kong-based infrastructure group in which Hutchison Whampoa has a near 90 per cent stake - is believed to be considering an offer. CKI is reported to have hired Rothschild to help it table a bid.

AB Ports' chief executive, Bo Lerenius, is believed to be meeting representatives from Admiral and Britannia this week to discuss their proposals.

Goldman would not comment yesterday on whether it would be prepared to raise its offer. However, a spokesman for the consortium said the group had put a lot of time and effort into the bid, and would not want to lose the auction.

Earlier this month, Goldman was pipped to the post by the Spanish infrastructure group Ferrovial in the auction for BAA, the British airports operator. Goldman has also made failed bids for ITV and the pubs group Mitchells & Butlers, putting it under pressure to pull off a deal.

Shares in AB Ports - which operates 21 ports in the UK, including Hull, Southampton and Immingham - have increased by almost 50 per cent this year, and more than 80 per cent over the past 12 months. They closed at 869p on Friday, well above the Goldman offer, reflecting the market's anticipation of a serious bidding war. Six years ago, Mr Lerenius turned down a 320p-a-share offer for the company, while he also rejected an initial 730p a share offer from the Goldman consortium in March this year.

If AB Ports is sold, it will become the third UK ports operator to be snapped up in just six months. DP World, the Dubai-based infrastructure group, bought P&O for £3.9bn in March, while Babcock & Brown, which owns Australia's second-biggest coal port, bought PD Ports for £607m in December.

Another Macquarie consortium - comprising the Carlyle Group and Babcock & Brown - is also considering a bid for the Seattle-based ports operator, SSA Marine.

Macquarie is now the world's largest non-governmental owner of infrastructure assets.

Banks and pension funds have been clamouring for infrastructure assets over the past few months, keen to gain steady returns to match their long-term liabilities.