MAG reported to be interested in Gatwick
05.05.08
Manchester Airports Group (MAG) said it would be interested in buying Gatwick Airport should BAA be forced to sell it by the Competition Commission (CC), the BBC reports, citing the company's chief executive.
MAG currently owns Manchester, East Midlands, Bournemouth and Humberside airports, and is the largest airport operator in the country after BAA. It is currently considering selling Humberside Airport, although this is unlikely to raise much cash.
Geoff Muirhead, chief executive of MAG, told the BBC: 'We'd be interested in any assets that come up, on the premise that we feel we could improve the performance of the group on the back of it, at a price that was sensible.'
The CC said last month that BAA, which owns and operates seven UK airports, 'may not be serving well the interests of either airlines or passengers'. No conclusions have been reached, but it confirmed its final findings in August could require 'the sale of one or more of BAA's airports'.
The BBC said Gatwick is seen as the most likely candidate for sale in the South East, with industry experts estimating the airport could fetch £2bn - £3bn. The CC also criticised BAA's ownership of Edinburgh and Glasgow Airports, with reports suggesting that it could be forced to sell Glasgow Airport, with rumours that this would be MAG's target. Price wise, at around £700m, it would seem more realistic.
MAG is privately owned by 10 borough councils. How they would justify the investment and risk of taking on the purchase of Gatwick, we are not sure. One councillor suggested that they should sell up late last year. They could justify controlling the regions airport – it helps the councils encourage growth in the area, and it can take a longer term view, focusing on wider benefits rather than short term profits – but could they justify owning a large London airport? Especially if the risk if things go wrong.
Last week, a source close to Abertis Infraestructuras said the Spanish infrastructure company was also interested in buying some of BAA's assets should the break-up go ahead.
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