KKR hires RBC to pilot Queensland Airports bid; flyers out

afr.com:

Only sunscreen and XXXX Gold in Christmas presents this year for KKR dealmakers, who are about to spend their summer doing due diligence in Queensland.

Gold Coast Airport accounted for 74 per cent of QAL’s FY23 revenue.  

Street Talk understands the US private equity giant has signed up RBC Capital Markets to help it prepare a non-binding indicative bid for Queensland Airports Limited, which owns the airports at Gold Coast, Townsville, Mount Isa and Longreach.

KKR’s interest comes as sell-side advisers Barrenjoey and Macquarie Capital pound the pavement with a 16-page teaser on QAL, and a freshly upsized mandate to seek buyers for a 74 per cent stake on behalf of The Infrastructure Fund, State Super and Australian Retirement Trust.

QAL’s financials have “fully recovered” to pre-COVID levels, according to the flyer. Its revenue halved when the pandemic struck – going from $147 million in the 2019 financial year to $73 million in 2021. But it has since bounced back and ended June 30 at $177 million, boiling down to $118 million in EBITDA or a 66 per cent margin.

That’s despite passenger volumes ending the 2023 financial year at 8 million, or about 96 per cent of pre-COVID levels.

The sell-side pitch said QAL could add another 2.5 million passengers within its immediate catchment areas in Gold Coast and Townsville, while expanding both domestic and overseas routes. Its 450 hectares of land holdings have enough white space for additional retail, ground transport and aeronautical services to service Queensland’s growing economy, according to the flyer.

Prospective bidders are also told to think about QAL’s ability to serve as a platform for future investments in Australia and New Zealand. The flyer cited North Queensland