South African, French and Argentinian companies have clinched $14.2bn in concessions to expand and run three of Brazil’s busiest airports in a landmark privatisation effort by the government of president Dilma Rousseff.

A consortium led by Brazilian companies Invepar and OAS and South African airport operator ACSA won the most important concession, São Paulo’s Guarulhos international airport, with a bid of R$16.2bn, five times the minimum value set by the government.

“This is a really positive sign for the country as it shows again that it’s a place where investments are not only secure but where they give good returns,” said Brazil’s secretary of civil aviation, Wagner Bittencourt.

The auction of the airport concessions represents a breakthrough in Brazil’s preparations to stage the World Cup soccer final in 2014 and the Olympics two years later, which have been struck by serious delays.

Soaring domestic air
traffic means that Guarulhos and Brazil’s other airports are already running at overcapacity and will struggle to keep up with forecast demand.

Under the other deals, Brazil’s Triunfo and France’s Egis Airport Operation won the concession to upgrade Viracopos Airport, in the satellite city of Campinas near São Paulo for R$3.8bn.

Brazil’s Engevix and Argentina’s Corporación America clinched the contract to build an airport terminal in the capital, Brasília with a bid worth R$4.5bn.

The hefty price of the bids sent shares of Triunfo down 5 per cent after it won the Viracopos concession while stocks of unsuccessful bidders Ecorodovias and CCR Rodovias rose 5.5 per cent and 1.7 per cent respectively.

Gustavo do Vale, the head of Infraero, vowed that the state-run company, which had a monopoly over airports in Brazil until the auction, would not interfere with the running of the airports, adding that it would only retain 49 per cent control for dividend reasons.

“These three operators can run their airports however they want, using the experience they have gained elsewhere,” said Mr do Vale.

The three consortiums said they would be likely to go to BNDES, Brazil’s development bank, for part of the funding for their projects.

The concept of privatisation is highly controversial in Brazil, particularly for the centre-left government of Ms Rousseff’s Workers’ party, with unions distrusting private sector takeovers of state-run operations.

But the president was forced to take the more pragmatic option of outsourcing the operation of the airports rather than risk chaos during the World Cup and Olympics.

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