Atlassian co-founder and KKR snare majority stake in Queensland Airports for $3b

The deal, which will see the consortium emerge with a 74.25 per cent stake in QAL, has been mooted for some time after superannuation funds State Super and Australian Retirement Trust had initially sought to exit their combined 34.24 per cent holdings a little over a year ago.

However, The Infrastructure Fund (TIF) which is managed by Macquarie Asset Management, later threw its hat into the ring by offering up its 40 per cent interest which has led to keen interest from major investors looking to gain a foothold in Queensland’s booming regional airport sector.

The four airports in the QAL portfolio service more than 40 domestic and international routes with nearly 66,700 aircraft movements annually.

The airports handled 8.1 million passengers in 2023, up 10 per cent from a year earlier, with the Gold Coast accounting for the lion’s share at more than 6.2 million passengers – up more than 500,000 from 2022.

Gold Coast Airport, which is Australia’s sixth-busiest airport, has benefitted from more than $500 million in capital expenditure by QAL over the past five years, including the southern terminal expansion completed in 2022 which doubled the airport’s footprint to 30,000sqm and added four aerobridges to the facility for the first time.

Townsville Airport also posted its busiest year on record in FY24 with more than 1.7 million passengers passing through the facility.

“Our investment in Queensland Airports is a unique opportunity to acquire a high-quality asset that provides critical services in a resilient market with strong macro tailwinds,” says Andrew Jennings, managing director and head of Australia and New Zealand infrastructure at KKR.

“Queensland Airports plays an important role in connecting Queensland communities to the rest of Australia and beyond.

“We look forward to collaborating with the Skip Essential Infrastructure Fund, Perron Group and the management team to drive growth initiatives to better serve passengers from Australia and abroad.”

Perron Group is the only major shareholder in QAL to have retained its stake, which currently sits at 24.62 per cent.

Skip Capital, which was founded by Farquhar and his wife Kim Jackson, has invested in QAL through Skip Essential Infrastructure Fund – which is focused on investing in renewable energy and decarbonisation, data infrastructure, up-valuing waste, food infrastructure and innovative health opportunities.

The Skip Capital fund currently has five investments in its portfolio including renewable energy producer Genex Power (ASX: GNX) and data centre group Stack Infrastructure.

“Alongside delivering critical transport into one of Australia’s highest growth corridors of the Gold Coast, we are excited about our plans to lift the airport’s offering for residents and tourists, and drive energy innovation across the group,” says Jackson, the CEO of Skip Capital.

Australian Retirement Trust sees the sale delivering a positive result for its superannuation membership.

“As an institutional investor, we’re always looking for opportunities to deliver the best possible outcomes for our members, and the timing of this sale alongside other investors supports that goal,” says Michael Weaver, the head of global real assets at Australian Retirement Trust.

“This process has formed part of our broader strategy to manage our portfolio, and we’re pleased with the outcome.

“Our capital helped support this investment to grow over many years, but we now look forward to new investors coming in and managing these assets as they enter a new phase.”

Gold Coast Airport has a significant capital expenditure program in train with a 20-year masterplan that also includes links to light rail and heavy rail.

Townsville Airport’s masterplan also includes runway and taxiway extensions by 2031, as well as an expansion of the passenger terminal.

“QAL plays an essential role connecting Queensland and northern NSW to the rest of Australia and the world,” says QAL’s CEO Amelia Evans.

“This year we will welcome more than 8.5 million passengers through our four airports. We have an exciting future ahead including the proposed Gold Coast Airport masterplan and the approved Townsville Airport masterplan, which will both stimulate new growth and economic opportunities, as well as customer experience improvements.

“QAL is grateful for the close working relationship we shared with our investment partners TIF, State Super and Australian retirement Trust to successfully deliver an exciting vision for the company, and we look forward to continuing to work closely with our long-standing existing investors.

“We are now excited to embark on a new chapter with the Skip Essential Infrastructure Fund and KKR and to work with them to grow our airports in the years ahead.”

The $3 billion acquisition of QAL, which is still subject to regulatory approval, is expected to settle by the end of this year.