Ryanair Among Prospective Buyers of London Stansted

AIN Air Transport Perspective » August 27, 2012
London Stansted Airport
London Stansted Airport is set to be sold to new owners in a move that promises to shake up the competitive dynamic between the country’s airports.
August 27, 2012, 10:10 AM

UK airports group BAA has reluctantly abandoned any further legal challenges to the compulsory sale of London Stansted Airport mandated by anti-trust authorities. It is now open to offers for what is the UK’s fourth busiest airport, and low-cost carrier Ryanair has emerged as a leading figure among potential bidders. Ryanair confirmed on August 21 that it has been asked to join a consortium that would buy Stansted jointly, with its own stake not exceeding 25 percent. Undisclosed pension funds, infrastructure investors and the owners of the UK’s Manchester Airport are also understood to be in the running to buy the facility from BAA.

Ryanair has made clear its motive for taking partial control of Stansted. The airline would be able to advance its long-standing agenda of driving down landing fees and other airport charges and making the field a haven for low-cost airline service.

But the new owners of Stansted could also have a valuable chip in the high-stakes poker game still being played over the future development of London’s airports. The British government is still blocking prospects for a new third runway at Heathrow Airport. BAA previously abandoned a plan for a second runway at Stansted, but it could be resurrected by new owners. What’s more, political momentum to allow extra capacity at one of the London-area airports appears to be building.

On August 20 BAA finally admitted defeat in its fight to retain ownership of Stansted after the British Court of Appeal refused further consideration of the case. BAA decided not to appeal to the UK Supreme Court, which was its only remaining option. It stated, “Having carefully considered the Court of Appeal’s recent ruling, BAA has decided not to appeal to the Supreme Court and is now proceeding with the sale of Stansted Airport. We still believe that the Competition Commission ruling fails to recognize that Stansted and Heathrow serve different markets.”

BAA, which is owned by a consortium led by Spain’s Ferrovial Group, has already been forced by the UK Competition Commission to sell London Gatwick Airport and Edinburgh Airport in Scotland. It retains Heathrow, Southampton, Aberdeen and Glasgow airports.

 

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