Fraport AG Frankfurt Airport Services Worldwide (Fraport AG) signed an agreement on August 6, 2018, to sell its entire 30 percent stake in Flughafen Hannover-Langenhagen GmbH (FHLG) to iCON Flughafen GmbH (iCON) – part of the iCON Infrastructure Group – for 109.2 million euros.
FHLG is the operating company of Hanover Airport (HAJ) in northern Germany. Fraport acquired shares in FHLG in two steps: initially 20 percent in 1998, followed by another 10 percent in 2003. The other 70 percent of FHLG is held equally by two co-shareholders: the City of Hanover and the Hannoversche Beteiligungsgesellschaft mbH – a wholly-owned company belonging to the State of Lower Saxony. The closing of the transaction is dependent on the contractually agreed pre-emption rights held by the two co-shareholders. Fraport currently expects the transaction to be concluded during the next two months.
Dr. Stefan Schulte, Fraport AG’s executive board chairman, commented on the divestiture: “For some time, we have received strong interest from the market for Fraport to sell its stake in Hanover Airport. This underscores Fraport’s competence in increasing the value of our airport investments, wherever we operate around the world. We achieve this by enhancing operations, infrastructure, and the customer experience. At the same time, we are pursuing the goal to acquire majority stakes in airports or to hold a position of significant influence in these airport companies.”
In 2017, traffic at Hanover Airport rose by 8.5 percent to 5.9 million passengers. For the first six months of 2018, HAJ achieved a 7.8 percent increase in passenger traffic to almost 2.8 million passengers (June 2018: up 10.2 percent to 632,621). Schulte added: “Hanover Airport is a solid business with a bright future. It has developed into an important aviation gateway in northern Germany for both passenger and cargo traffic. We would like to thank the other FHLG shareholders and the Hanover region for the excellent cooperation, and we wish them continuing success.”
Based on current book values and current expectations – that both co-shareholders will not exercise their pre-emption rights – Fraport AG expects the Hanover transaction to contribute about 85 million euros to the Group EBT. This will translate into approximately 25 million euros for the Group EBITDA and EBIT for the current 2018 business year. The Group’s financial result will be positively influenced by about 60 million euros. After deduction of related income tax liabilities, the transaction will also have a noticeable positive impact of about 77 million euros on the Group result (net profit).
As a result of the divestiture, Fraport AG’s executive board expects the Group’s EBITDA, EBIT, EBT and Group Result for the full 2018 business year to exceed the margins forecast at the beginning of the year. Furthermore, the cash inflow following the completed transaction will reduce the Group’s net debt.