Chicago pulls Midway airport concession

Washington DC
Source:
This story is sourced from Pro
See more Pro news »

Chicago mayor Rahm Emanuel has pulled a proposed up to 40-year concession of Midway International airport citing a lack of competition for the deal.

The move came after a consortium including Industry Funds Management of Australia and Manchester Airports withdrew from bidding leaving only a consortium including Ferrovial and Macquarie, the mayor's office confirms.

Chicago had hoped to maximise the value of the airport through an upfront payment to defease about $1.4 billion in outstanding debt, and an annual revenue share with the concession. It also wanted the concessionaire to improve the facility's competitive position and passengers' experience.

Lois Scott, chief financial officer of the city, said in a statement in January that any deal would have to be a "win for Chicagoans and ensure that certain conditions and criteria are met".

A 40-year concession of the San Juan Luis Munoz Marin airport, which was structured similarly with an upfront payment and revenue share, closed this past February. Grupo Aeroportuario del Sureste (ASUR) and Highstar Capital-owned Aerostar Airport Holdings now operates the airport.

Southwest Airlines and its subsidiary AirTran Airways dominate Midway. Together they carried about 94% of enplaned passengers during the year ending 31 May, according to US Department of Transportation (DOT) data.

Delta Air Lines was the third largest airline at the airport with a 2.2% market share during the period, the data shows.