Ferrovial to focus on BAA airport business

Ferrovial has decided to focus its UK airport business on airports operated by BAA and has sold Belfast City Airport for £132.5 million.

Belfast City Airport, also known as George Best airport after the Northern Ireland soccer legend, is smaller than Belfast International airport and mainly operates regional flights to the UK.

The airport has been purchased by ABN Amro Global Infrastructure Fund and the sale appears to represent a good deal for Ferrovial. The Spanish group says its capital gains from selling Belfast City airport will be approximately £85.6 million. It paid £35 million for the airport in 2003.

Cash strapped Ferrovial was rumoured to be in talks to sell the airport back in April, as reported by Holiday Extras. Having bought BAA for £10.3 billion in 2006, Ferrovial is thought to have debts of more than €30 billion and has been disposing of non-core assets.

In the last two years Ferrovial has disposed of its holdings in the airports at Bristol, Sydney and Budapest. Earlier this year BAA sold the World Duty Free shops at its seven UK airports for £546 million and a portfolio of 33 commercial properties to airport hotel group Arora for £265 million.

Following the report into BAA's airports monopoly by the Competition Commission last month, it appears likely that BAA will have to sell both Gatwick and Stansted airports, as well as either Edinburgh or Glasgow airport. The healthy price obtained for the much smaller Belfast City airport suggests that if BAA is forced to sell Gatwick and Stansted then even in the current gloomy economic climate it could make a good profit.

The sale of George Best airport is expected to be completed by the end of September. This year about 2.5 million people will use the airport. Regional airline Flybe currently offers 17 routes from Belfast City, including flights to Gatwick, Birmingham, Manchester, Edinburgh and Paris Charles de Gaulle. Other airlines operating from the airport include bmi and Ryanair. There are also winter ski flights to Geneva, Salzburg and Chambery.

Written by: Nick Purdom

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