MacBank to sell airports stake

Macquarie Airports shares closed trading yesterday at $1.16, up 3c on the day, marking a steady recovery from lows of 80c late last year.

Yesterday, sentiment towards the stock was cheered by the firm December-half earnings of Sydney Airport which showed an 18.2 per cent rise to $187.5 million in gross profit putting it well within reach of the full-year target of $380 million. Sydney Airport is nearly half-owned by Macquarie Airports.

The holding Macquarie Bank was last night seeking to sell was the shortfall from Macquarie Airports's disastrous $645 million share issue last year at $1.50 a share.

That issue, jointly underwritten by Macquarie Equities and UBS Warburg, was to raise funds for the acquisition of a large slice of equity in Aeroporti di Roma, the operator of two airports in Rome.

Earnings at Aeroporti di Roma were downgraded after Macquarie Airports disclosed it intended to buy in. The downgrade reflected poor passenger numbers through the European summer.

The issue suffered a 99 per cent shortfall, with Macquarie Equities left holding 58 million Macquarie Airports shares at a written down value of $1.02 a share. Clearing the overhang, which is mostly expected to be sold to local institutional investors, is expected to take pressure off the Macquarie Airports share price.

Macquarie Bank was seeking to sell the large parcel of stock, equal to 6 per cent of Macquarie Airports capital, at around $1.12 to $1.15 a share.

Clearing the overhang at around this price will enable the bank to write back around $6 million of the underwriting loss incurred on the Macquarie Airports share sale.