UPDATE 2-Spain to part-privatise airports, weak price seen

(Recasts, adds minister and analyst comment, detail, background)

By Ben Harding

MADRID Aug 1 (Reuters) - Spain will privatise some 30 percent of the world's biggest airport authority, AENA, it said on Friday - but juicier investment options abroad and cash-strapped buyers at home would squeeze the price, analysts said.

Under the plan, the government will split air traffic services from airport management, keeping the former in state hands while part-privatising the latter.

Infrastructure Minister Magdalena Alvarez told a news conference that the whole of AENA, which manages 47 airports, was worth 30 billion euros ($46.7 billion).

However, analysts said specialist infrastructure funds would probably be more interested in rival privatisations at Chicago Midway, Prague and St Petersburg, as a Spanish deal would not deliver them majority control.

Meanwhile, at home, many of the obvious buyers -- construction firms -- are staggering under hefty debts and a property slowdown that will force them to drive a hard bargain on price, if they bid at all.

It's awkward timing for a government that is searching for cash to prop up an economy in crisis.

"It's not going to be a crazy price," said BNP Paribas analyst Steven Fernandez.

Recent airport deals value assets at around 18 times EV/EBITDA, he said, but the lack of control premium, exposure to political meddling, and tight cash among Spanish construction companies was likely to halve that figure.

That would value the 30 percent stake at 3 billion to 5 billion euros, well below the 9 billion euros implied by the government estimate.

TWO YEAR SALE

Alvarez said it would take at least two years to sell the stake in AENA, which had 210 million passengers pass through its airports last year.

The state-owned operator invested 7.5 billion euros from 2004 to 2007, doubling the number of runways at Madrid airport to four and adding the state-of-the-art T4, which takes capacity there to 70 million people a year.

Expansion at Barcelona's El Prat will double capacity to 55 million, while it has also spent billions expanding Malaga, Alicante and other airports.

The chairman of Spanish builder FCC (FCC.MC) said on July 8 that his construction firm was interested in AENA, while infrastructure operator Abertis (ABE.MC) said it was studying the situation.

Possible foreign bidders include Germany's Hochtief (HOTG.DE) and Fraport AG (FRAG.DE), and Amsterdam's Schiphol airport.

Canadian pension funds such as Caisse de depot et placement du Quebec, CPP Investment Board and the Ontario Teachers' Pension Plan all have a history of bidding for airport assets, as does Macquarie Infrastructure Group MIG.AX.

Spain's Ferrovial (FER.MC), which controls British airport operator BAA, declined to comment on the news, but is seen as an unlikely bidder as it is saddled with debts of 29 billion euros.

Alvarez also told the news conference that regional governments could take a share of management companies at airports processing over 30 million passengers a year, which include Madrid and Barcelona. (Reporting by Ben Harding; Editing by Rosalba O'Brien)