Monday, May 8, 2017
Trudeau government contemplating to sell A minority stake of Pearson airport?
Canadian government contemplating to sell A minority stake of Pearson airport? (MSM). By Josh Wingrove and Scott Deveau.
Canada is considering the sale of at least a minority stake in Toronto Pearson International Airport that values the country’s busiest airport at about C$5 billion ($3.7 billion), according to people familiar with the matter.
The stake sale, just one of many options laid out in a report to government prepared by Credit Suisse Group AG, would free up billions of dollars for new infrastructure projects, the people said, asking not to be identified because the matter is private.
A federal advisory panel recommended last year the government look at selling its airports, and the C.D. Howe Institute estimates privatization of the country’s eight major airports could rake in between C$7 billion and C$17 billion, with Pearson alone fetching as much as C$6 billion. Selling the airports would cut costs for travelers and create opportunities for more shops and services, the non-partisan research institute said.
“The subject is still being studied and no decision has been taken,” Marc Roy, a spokesman for Transport Minister Marc Garneau, one of the lawmakers overseeing the consideration of privatization. “We won’t comment on any rumors.” The government has so far declined to release the Credit Suisse report.
Selling slightly less than half of Pearson would be the easiest of several scenarios Credit Suisse presented to Prime Minister Justin Trudeau’s government in a report last year, according to the people. That scenario would allow the government to retain control of the airport while raising billions for other projects.
Sam Pollock, the head of Brookfield Asset Management Inc.’s infrastructure group, has said there would be a “feeding frenzy” among institutional investors if airports were put up for sale.
Benefits and Pitfalls
The confidential Credit Suisse report outlined the potential benefits and pitfalls of various scenarios of such a move. Trudeau downplayed airport sale expectations last month when he said he was more “interested in other things.” Sources familiar with the government’s thinking said the privatization of any of the nation’s airports is still being considered.
Credit Suisse’s findings represent “one element of a broad range of information the government will consider” in weighing airport privatization, Dan Lauzon, a spokesman for Finance Minister Bill Morneau, said by email Friday. “The government has taken no decisions at this time.” Hmmm.....Where's there smoke there's a fire. Read the full story here.