Airport operator Fraport has sold its 24.5% stake in Xi’an Airport (XIY) in Central China to investment company Chang’an Huitong for RMB1.11bn (US$174m).
The transaction is expected to be completed by June 2022. Fraport acquired its stake in XIY in 2008, with the unsuccessful aim of expanding its business in China. Now the company expects the sale to have a positive impact on its operating result (EBITDA) and financial result (net profit). Moreover, the company’s net financial debt will be reduced by the additional cash inflow resulting from selling the stake.
Dr Stefan Schulte, CEO of Fraport, explained, “We reflect on our activity in Xi’an with great satisfaction but also some disappointment. On the one hand, the Xi’an subsidiary gave us an opportunity to showcase our expertise in airport management. Indeed, over the past 14 years, Fraport successfully developed Xi’an from a medium-sized regional airport with about 10 million passengers annually to one of China’s largest aviation gateways, serving more than 40 million passengers per year.
“On the other hand, we always regarded our minority stake in Xi’an as a starting point for expanding our business in China – the most populous country in the world. However, this never materialized in Xi’an or at any other Chinese airport. Consequently, we have now decided to cease our activities in the Chinese market. With gratitude, we thank our partners at Xi’an Airport and the entire region for their excellent support. We also wish Xi’an Airport all the best for the future.”