Porter puts Toronto terminal up for sale
The Canadian PressFriday, August 29, 2014
TORONTO - Porter is looking for buyers for its passenger terminal at the island airport in Toronto.
Porter Aviation Holdings, the parent company of the regional airline that is the main tenant at the Billy Bishop airport, said Friday a sale-leaseback deal would allow it to focus on its core business.
"The proceeds from the sale will help the airline invest in growth opportunities going forward," said Michael Deluce, executive vice-president and chief commercial officer at Porter.
These opportunities could include the airline adding more flights, destinations or upgrades to its airport lounge.
Porter Aviation designed and built the terminal that it has been operating since 2005.
Deluce said the terminal was an "important early investment" for expanding the airport's growth to 2.3 million passengers from 20,000 in 2005.
The company expects the sale to be completed within four months, and is looking at buyers in the pension and infrastructure investment funds in Canada and abroad. Porter would consider entering a long-term rental agreement with the new owner to use the terminal once the deal is done.
Deluce would not speculate on how much the sale would be worth, and dismissed a report from the Wall Street Journal that put the sale value at about US$500 million. He said it was too early to come up with an estimate.
Porter started flying in October 2006 and now serves 20 destinations in Canada and the United States.
The airline is currently involved in a politically-charged battle over its expansion plans for the airport's runway, which will allow it to fly larger jets from the downtown airport.
In 2013, it asked the city of Toronto, Transport Canada, and the Toronto Port Authority to amend a tripartite agreement that prevents jets from using the island airport except under special circumstances.
It has also placed a conditional order with Bombardier for 12 CS100 aircraft, worth about US$2.08 billion, that would extend the reach of the airline to destinations such as Los Angeles, Florida, Calgary and the Caribbean.
In the spring, city council voted to move ahead with negotiations on the expansion but requested further study on the environmental impacts as well as how it would affect traffic, among other issues. A decision is not expected until next year, after the municipal election in the fall.
Opponents to the plan, including the group NoJetsTO, made up of a coalition of citizens, say they are concerned about the impacts the jets might have on marine life and residential noise levels, and they want Toronto's waterfront to stay for mixed-use.
Deluce said the sale has nothing to do with the airline's expansion plan, adding that it will go ahead notwithstanding "any decision if Porter's (expansion) plans are completed or not completed."
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