Chairman predicts Competition Commission report will order BAA break-up and says buyer interest already “huge”
The chairman of BAA, the UK's largest airport operator, has said he expects the Competition Commission to order the break-up of the company.
A preliminary report by the watchdog, due to be published next week by the Competition Commission, follows a 16-month probe and could potentially lead to BAA being forced to sell one, two, or three of its London airports in a series of possible reforms to counter the firm's market dominance.
In an interview with the BBC, Sir Nigel Rudd said that there had already been “huge expressions of interest” from potential buyers of Gatwick and Stansted, although neither airport was at present for sale.
BAA - which owns Heathrow, Gatwick, Stansted, Edinburgh, Glasgow, Southampton and Aberdeen airports - has been saddled with debt since its purchase by Spanish property group Ferrovial in 2006. With its monopoly on airports in the South-east, there have been concerns that BAA can focus only on one development project at a time, causing capacity problems.
“All [the] things I am hearing suggest they are going to make this sort of recommendation,” said Sir Nigel, but admitted it would not be a “disaster” if the watchdog did demand the sale of some airports.
Manchester Airport Group, the largest UK-owned airports group, said it had gained the backing of its shareholders to investigate bidding for the BAA assets.
Global Infrastructure Partners, a joint venture between Credit Suisse and General Electric's GE infrastructure fund, which bought a 50% stake in London City airport in 2006, has also expressed interest in bidding for BAA assets, in particular Gatwick or Stansted.
BAA has come under recent fire for poor service and excessive airline charges.
The report's final conclusions will be published in eight months' time.