Proposals arrive on running airport
Liset Marquez, Staff Writer
Posted: 04/03/2011 09:22:50 AM PDT
ONTARIO – So much for worries that no one would want to run L.A./Ontario International Airport.
A search for new management at the troubled airport attracted global interest.
Companies in Germany, India, Korea and Australia submitted proposals to Los Angeles World Airports, the agency which operates ONT but which requested proposals to take over the job.
And two heavyweight firms are among the interested parties: Goldman, Sachs & Co. and the Carlyle Group.
Goldman, Sachs, a global investment banking and securities firm, has assets of $911 billion and more than 35,000 employees worldwide. The company received $5.5 billion in federal bailout funds in 2008.
The Carlyle Group, the second-largest private equity firm in the world, once had former President George H.W. Bush as an adviser.
A presentation to LAWA’s Board of Airport Commissioners on the 10 proposals is expected in May. The airport commissioners are expected to make recommendations on the proposals.
LAWA officials have indicated the purpose of the expressions of interest was to inform them as to how best to proceed with operations at ONT.
Gina Marie Lindsey, LAWA’s executive director, has referred to the Expressions of Interest responses as encouraging and said they indicate “ONT is a key asset for the city of Los Angeles.”
While representatives of the Goldman, Sachs subsidiary said they felt they did not meet the requests outlined in the EOI, they decided to submit a letter offering their opinion after they were “encouraged” to by LAWA representatives and their consulting team.
They admit in their packet that they do not have any airport operating expertise but are shareholders of several airports.
In their proposal, they affirm LAWA’s belief that ONT’s current situation is a result of the economy.
The firm acknowledges that other factors such as “micro operating issues” have affected ONT’s performance and says: “We believe the management opportunity at ONT is one where we, partnered with the right operators, could succeed in improving airport services, minimizing airport services, minimizing costs and improving existing facilities.”
The Goldman Sachs subsidiary goes on to state the importance of re-establishing growth “as soon as possible.” A further decline in airline carriers could make it unsustainable for all carriers, the proposal states.
Another firm that has shown interest in ONT is the Washington, D.C.-based Carlyle Group, which invests primarily in the aerospace, defense and automotive sectors.
“As an active investor in the public infrastructure sector, Carlyle Infrastructure is enthusiastic about the Airport, and we are eager to conduct further due diligence on this opportunity,” Carlyle officials wrote in a letter to LAWA’s chief operation officer, Marla Bleavins.
The firm indicates in its packet that it would form a consortium to invest, manage and operate ONT.
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