UK airports operator BAA has agreed to a £10.1 billion (€14.7 billion) takeover bid from a consortium led by Spain's Grupo Ferrovial today after rejecting a rival higher offer from Goldman Sachs.
The Goldman Sachs-led consortium has not ruled out fighting back with an improved offer, however, and was weighing up its options, a source said.
"The board believes that an offer at this level represents an attractive price for BAA," BAA said in a statement.
Goldman Sachs earlier confirmed it had offered 955.25p per share. A source familiar with the situation said Goldman Sachs may further raise its bid.
Ferrovial's adviser on the deal, Citigroup, bought almost 15 per cent of BAA shares in an early raid today in a bid to help fend off a rival offer from Goldman Sachs, another source said.
Shares in BAA were up 2.3 per cent at 949p in morning trade after hitting an all-time high of 953p. Ferrovial shares in Madrid were down 0.9 per cent at €59.95 .
Airports are drawing investors attracted by a highly visible, long-term outlook, with traffic in Europe expected to double by 2020 to 2 billion passengers.
Higher traffic will boost revenues from landing fees and airport businesses such as leases for shops and restaurants.
Opportunities to buy major European airports are also few.
Last week, Ferrovial's hostile offer of 900 pence a share was rejected by BAA. It also rejected an informal approach by Goldman Sachs earlier this year.
The UK Takeover Panel said Goldman Sachs had until June 16th to make a revised offer for BAA, extending an earlier bid timetable by a week.