Porter puts terminal up for sale; eyeing expansion
Sept. 2, 2014, Toronto - Porter is looking for buyers for its passenger terminal at the island airport in Toronto.
September 2, 2014 By The Canadian Press
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
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
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