Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), has signed a share purchase agreement to acquire a 10 percent stake in London’s Heathrow Airport from Spanish infrastructure giant Ferrovial. The deal, valued at $3 billion, marks PIF’s strategic move into diverse sectors. The acquisition involves a stake in FGP TopCo, the holding firm of Heathrow Airport Holdings. Concurrently, French-based private equity fund Ardian is set to acquire an additional 15 percent share in the parent company through separate vehicles.
PIF said: PIF is pleased to be investing in Heathrow, a world-class airport, which acts as a key gateway to the world. PIF’s investment in Heathrow is in line with its strategy to support the business as a long-term partner.
Heathrow is one of the world’s largest air traffic platforms, connecting the UK with global trading partners to help stimulate economic growth.
Ferrovial, a stakeholder since 2006, will divest its interest in the UK airports’ operator pending regulatory approvals. The transaction will bring an end to Ferrovial’s involvement, which began with a 56 percent stake in 2006, later reduced to 25 percent in 2013.
In a press statement, PIF expressed satisfaction with the investment, emphasizing Heathrow’s status as a world-class airport and a crucial global gateway. The fund sees the acquisition as aligned with its long-term partnership strategy to support business development.
Notable stakeholders in FGP TopCo include the Qatar Investment Authority, Singapore’s sovereign wealth fund, the Australian Retirement Trust, and China Investment Corp. Heathrow Airport, a major global air traffic hub, plays a pivotal role in connecting the UK with international trading partners, fostering economic growth.
PIF has been actively contributing to Saudi Arabia’s economic diversification by making strategic investments across various sectors. According to its annual statement released in October, PIF has established 70 companies since its inception, with 25, including Saudi Coffee Co. and Halal Products Development Co., founded in 2022. These companies collectively generated over 181,000 jobs in 2022.
In a recent initiative, PIF launched Tasaru, a company dedicated to developing local supply chain capabilities for the automotive and mobility industry in Saudi Arabia. The fund has also made significant investments in the future mobility sector, including establishing Saudi Arabia’s first national electric vehicle brand, Ceer, in partnership with Foxconn, and investing in US-based Lucid Motors.