BAA Gatwick sale sparks early interest

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Several parties have voiced their interest in London Gatwick Airport following UK airports operator BAA's decision to dispose of the south London hub.

Yesterday BAA confirmed it plans to sell Gatwick following provisional competition probe findings which called for the sale of two of its three London airports, the others being Heathrow and Stansted.

Several airports operators have already expressed potential interest in the Gatwick sale, including Fraport, Hochtief AirPort and Manchester Airports Group.

A spokeswoman for Hochtief AirPort, which has interests in Athens, Budapest, Dusseldorf, Hamburg, Sydney and Tirana airports, says: "It is too early in the process to discuss details, but I can confirm the strong interest of Hochtief AirPort in a potential sale of Gatwick Airport. Gatwick is a very interesting airport."

A spokesman for Frankfurt Airport operator Fraport, which already owns shares in a number of other airports, says: "We are looking with interest for the conditions [of the sale]. In general, we are not giving any more information."

Manchester Airport Group - operator of UK airports East Midlands, Bournemouth and Humberside alongside Manchester Airport - says the group "remains interested in one or more of BAA's airports if an acquisition would add value for our shareholders."

Another UK airports operator - Peel Airports which owns Liverpool Airport, Doncaster Sheffield and Durham Tees Valley Airport - is also interested in the airport.

"We can confirm Peel Airports has been approached by interested parties with a view to us participating as an operator and as a potential co-investor," says a company spokesperson. "Peel Airports could add significantly to Gatwick and would consider participating with other investors in any sale of the Airport. We will review all options before making any decision on whether we proceed or not."

From an airline perspective, Gatwick user Virgin Atlantic Airways has expressed an interest in participating as part of a consortium. A Virgin spokeswoman says: "Virgin Atlantic would relish the opportunity to bid for Gatwick as part of a consortium and inject our customer service expertise into any future running of the airport."

But she adds: "Gatwick doesn't just need a new owner. It needs a much tougher regulatory system which ensures any new owner doesn't simply become BAA mark two."

A BAA spokesman stresses the process, which could run for up to a year, is in its early stages. The airport operator is yet to appoint an advisor, but he says this should be done over the next few weeks.

The spokesman adds: "We are sure there will be considerable expressions of interest, but we have no one waiting in the wings.

"We have obviously had approaches from various organisations and parties. Our CEO hasn't got back to them because he is waiting until the start of the formalised sale process. Once the advisor is in place, those people can approach us properly, but it's nice to know that there's interest."

BAA has kept the UK Competition Commission informed about its plans, but the spokesman says it still plans to challenge the body's findings.

"We are still having a debate with them. We disagree quite strongly with some of their provisional findings and hope to change their mind on a few things before the final report is published, early next year," says the BAA spokesman.

The Competition Commission says: "Our investigation continues. Once we have received and considered the responses to our provisional findings and to our remedies notice, we will reach our decisions and publish our final report in the early part of 2009 on both the competition issues and the appropriate remedies.

"We will, of course, take account of any action by BAA in the meantime which may impact the competition problems we have provisionally identified."

BAA operates seven UK airports: Heathrow, Gatwick, Stansted and Southampton in England, and Edinburgh, Glasgow and Aberdeen in Scotland.

The Commission's provisional findings identified competition problems at each of the seven airports, recommending the sale of two of its three London airports and either Edinburgh or Glasgow airport.