Ontario Teachers’ eyes Prague airport

The Canadian pension has confirmed it’s looking to increase its infrastructure assets with the addition of a second European airport to its portfolio.

Canada’s largest single-professional pension, the Ontario Teachers’ Pension Plan, is in talks to acquire a 50 percent stake in Prague Airport in partnership with France’s state-owned operator Aeroports de Paris. A spokeswoman confirmed the negotiations but declined to disclose financial details.

More than 12 million passengers pass through Prague Airport each year, making the terminal the largest airport in the Czech Republic and the second biggest in Central Europe.

Should a deal be struck, it would be the  second European airport to land in the pension’s portfolio. In 2007, Teachers’ partnered with Victorian Funds Management to buy a 48.25 per cent stake in the UK’s Birmingham International Airport for C$918-million, a deal that included investments in ports, toll roads and gas and water utilities.

The C$106 billion ($105 billion; €67 billion) fund told sister website PrivateEquityRealEstate.com a deal for the state-run airport is part of its infrastructure investment strategy.

Infrastructure was a key element of Ontario’s investment allocation strategy, she added, as the returns were tied to inflation thereby providing a hedge for us inflation-protected pensions. This is an increasingly common theme among many large public pensions.

Last week Canada Pension Plan Investment Board won its bid to take a 39.2 percent stake in Auckland International Airport in a deal worth an estimated C$1.4 billion.