A group of investors led by the Ontario Teachers' Pension Plan (OTPP) won the bid to buy London City Airport for more than £2 billion ($2.8 billion). The consortium involved the OTPP, Borealis Infrastructure, Alberta Investment Management Corp., and Kuwait Investment Authority's Wren House Infrastructure Management.

The deal was made with the Global Infrastructure Partners (GIP) after the group of investors won the bid battle with other potential buyers. Among interested potential buyers are Chinese airlines owner HNA and Cheung Kong Infrastructure Holdings, controlled by Asia's richest man, Li Ka-Shing. GIP bought the airport 10 years ago from Irish billionaire Dermot Desmond for  £750 million. Desmond purchased the facility in 1995 for just  £23.5 million.

According to Telegraph, the auction was first revealed in August, run by Credit Suisse. The auction attracted a lot of bidders from the infrastructure investment sector, mostly because it's a rare opportunity that investors could acquire an airport.

The London City Airport serves about four million passengers annually. The number has rocketed compared to 2.8 million in 2010. The airport is requesting a £200 million expansion plan, allowing the facility to serve twice as much passenger traffic by 2030 and enlarging the terminal and airfield for 50 percent more flights.

However, according to The Guardian, the mayor Boris Johnson is blocking the expansion plan as campaigners are attempting to restrain the present operations. The locals are campaigning over the concerns noise and pollutions, especially if the expansion plan is going to be carried out.

Other concerns come from the airport's business customer. IAG, who owns to British Airways warned the airport management that its airlines was prepared to move its operations elsewhere if any buyer attempt to increase landing charges, especially because of the cost of the airport's purchase. The British Airways is the London City's biggest customer.

IAG's chief executive Wille Walsh dismissed the valuation of £2 billion as "foolish". He also noted that the price is almost 30 times of the airport's earnings before interest, tax, depreciation and amortisation in 2015. Walsh expressed his concerns on how any buyer could recover or make any return on that investment unless they make significant increases in airport charges.

According to MarketWatch, the deal comes at the time when Canadians have steadily been buying assets in London's commercial property market. Previously, a Canadian firm also bought Songbird Estates PLC, while another Canadian firm bought the UBS Group AG office in London. 

The investor group, led by a Canadian teachers' fund and involving others Canadian firm and Kuwait investment agency has agreed on the £2 billion valuations to acquire the London City Airport. Some hold concerns on the airport's future operations, especially due to the expansion plan and possible increase in charges because of the high acquisition price by the new owners.