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KUALA LUMPUR (Reuters) – Global Infrastructure Partners (GIP) said its buyer BlackRock (NYSE:) will not participate in the privatization of Malaysia’s airports after criticism in Muslim-majority Malaysia over the U.S. company’s alleged ties to Israel.
GIP, Malaysian sovereign wealth fund Khazanah Nasional and others are part of a consortium bidding to take over Malaysia Airport (MAHB) in a privatization deal that would value the airport operator at $3.9 billion.
The plan has come under criticism and protests from some ruling and opposition party lawmakers in Malaysia, a staunch supporter of the Palestinians, over GIP’s ties to BlackRock’s significant investments in Israel, which is waging a war against the Palestinian militant group Hamas in Gaza.
The planned privatization of MAHB is the latest focus of protests in Malaysia, following boycott campaigns against Western brands such as McDonald’s (NYSE:) and Starbucks (NASDAQ:) over the war in Gaza.
GIP said its current leadership team “will retain full control and responsibility for the strategic and operational direction of GIP and the companies in which we have invested” following its acquisition by BlackRock, Bernama news agency reported on Friday, citing a written response from GIP. Head of Transportation Phil Ely.
A GIP spokesperson confirmed the Bernama report. The Treasury did not immediately respond to requests for comment.
Ely said the company will provide MAHB with a significant amount of operational support and assistance as needed despite being a minority shareholder.
“If we are successful in our turnaround, we would strongly consider relisting MAHB on the Malaysian Stock Exchange in the future,” he wrote.
The Treasury said GIP would not appoint staff to run MAHB directly, while Malaysian Prime Minister Anwar Ibrahim described claims that 25% of MAHB would be owned by a pro-Zionist company as baseless, without naming the company, Bernama reported.
Under the agreement, GIP and Abu Dhabi Investment Authority will own 30% of MAHB, while Khazanah and the Employees Provident Fund, the largest pension body in Malaysia, will own a majority stake. The Fund did not respond to a request for comment on the GIP statement.
BlackRock’s $12.5 billion acquisition of GIP is expected to be completed in the third quarter.
MAHB operates 39 airports across Malaysia and an international airport in Türkiye.
