December 16, 2014 / 12:12 AM / in 3 years

Exclusive: Porter nearing sale of Toronto airport terminal - sources

TORONTO (Reuters) - The parent of Canada’s Porter Airlines is nearing the sale of a passenger terminal it operates at Toronto’s Billy Bishop Airport, according to three sources familiar with the process.

A Porter Airlines Bombardier Q400 turboprop aircraft is seen in Toronto February 23, 2009. REUTERS/Mark Blinch

The sources, who asked not to be named as they are not authorized to publicly comment on the matter, said a bidding process for the asset on the island airport is underway.

One of the sources familiar with the process said at least two separate bids are expected this week from pension fund manager Alberta Investment Management Corp (AIMCo) and Macquarie Group Ltd (MQG.AX). The source did not specify whether Macquarie would be bidding directly, or through one of the funds it manages.

Porter Aviation Holdings Inc, the parent of upstart carrier, said in August it was considering selling and then leasing back the passenger terminal to focus on its core airline business.

AIMCo and Macquarie declined to comment. Porter could not immediately be reached for comment.

The Wall Street Journal, citing unnamed people familiar with the matter, earlier this year reported that a sale could bring in more than $500 million.

The second source said AIMCo is bidding for the asset in partnership with an infrastructure development focused firm.

The second source also said a key consideration for buyers is the prospect for Porter’s long-term success, including a controversial plan to get jets flying out of the hub.

Last year Porter Airlines unveiled a plan to more than double its fleet, with a conditional order worth up to $2.08 billion for Bombardier Inc’s (BBDb.TO) new CSeries jets.

Porter said in August a deal would not change its operations, and it would still be based at the regional airport, on an island just off Toronto’s downtown core. The airport itself is owned and operated by the Toronto Port Authority.

Canadian media reported earlier this year that Vantage Airport Group was another potential bidder. A spokeswoman for British Columbia-based Vantage was not immediately reachable for comment.

Vantage, which develops and manages airports around the world, is part a consortium bidding to re-develop the central terminal building at LaGuardia Airport in New York. It currently has a portfolio of nine airports on three continents.

Additional reporting by Allison Lampert in Montreal; Editing by Bernard Orr

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