BAA has agreed to sell its 100% interest in Gatwick, the second busiest airport in the UK, to Global Infrastructure Partners for a fee of £1.51bn.
BAA said that £55 million of the sale price is conditional on future traffic performance and the buyer’s future capital structure and that proceeds will be used to primarily repay part of BAA’s existing debt.
BAA announced its plans to sell Gatwick in September 2008, before the end of the Competition Commission’s UK airports market investigation. The inquiry found that customers were suffering from a lack of competition between airports.
BAA has been ordered to sell Stansted and one of Glasgow or Edinburgh, but is appealing against the decision this week.
Colin Matthews, BAA’s Chief Executive, said: “Gatwick and its people have long been a central part of BAA and we are proud of the airport’s development as one of the world’s leading international airports.
“BAA is changing and today’s announcement marks a new beginning for both Gatwick and BAA. We wish Gatwick well for the future and are confident that the airport will flourish under new ownership.
“BAA will focus on improving Heathrow and our other airports.”
The sale is subject to, among other things, EU merger regulation clearance. Completion of the sale is scheduled for December.
Investment fund GIP already owns London City Airport.
At the start of this year, BAA said its annual profits had fallen by 18.4% after the economic downturn dented passenger numbers.
It reported a profit of £582m before tax and interest, down from £713m in 2007, as the number of travellers going through its UK airports fell by 2.7%.
BAA was bought by Spain’s Ferrovial for more than £10bn in 2006.