According to the Nikkei Report and Kyodo News, bidding for the operating rights for the two airports is expected to be held this summer, with 40-45 year concessions on offer.
Once the sale of New Kansai International Airport and nearby Osaka-Itami Airport goes through, it will be first airport privatisation in Japan.
Bidding was provisionally scheduled for earlier this year, but has been delayed by extended negotiations between New Kansai International Airport Co and the government.
Citigroup Global Markets Japan and SMBC Nikko Securities have reportedly been appointed to advise on the process, and bidding guidelines are expected to be finalised with input from potential investors by June.
The winning bidder is expected to be selected by March 2015, with operations transferred to the new concession holder a year later.
The Nikkei Report says a buyer would be expected to make an up-front payment of ‘hundreds of billions of Yen and pay tens of billions of Yen a year after that’.
The privatisation aims to address the airport company’s debt of about $12 billion, which was incurred mainly as a result of airport construction of Kansai International.
Last month, Keiichi Ando, president and CEO of Kansai International Airport, told delegates at the ACI Airport Economics and Finance Conference in London, the Japanese government decided to privatise to raise funds and increase revenue and competitiveness.
“The main objectives are to reduce the debt burden of about $12 billion accumulated during the construction, and secondly to increase the competitiveness of both airports, by bringing in experienced operators and investors,” Ando explained.
Heathrow operator CEO Jorge Gil, from Ferrovial Aeropuertos, also revealed the Spanish firm’s interest at the same conference.