BAA break-up edges closer to reality

12th Aug 2008

BAA could be forced to relinquish its hold over airports in south-east England and Scotland, following reports that the UK Competition Commission is poised to rule that the airport operator is harming passenger interests. Critics point to record delays, overcrowding and under-investment.BAA, which is owned by Spanish company Ferrovial, owns London’s Heathrow, Stansted and Gatwick and Edinburgh, Glasgow and Aberdeen airports in Scotland.

The monopoly watchdog is likely to give a damning verdict when it publishes its report on BAA next month, reports the Scotsman newspaper. The report focuses on the lack of rivals to BAA, which could put pressure on it to selling at least one airport in London and one in Scotland.

Michael O’Leary is one of the staunchest critics of BAA. The Ryanair boss is currently in a legal spat with BAA over millions in unpaid landing fees. The low-cost carrier has refused to pay BAA’s increased fees on departures and arrivals at Stansted on 1 April 2008, which rose from £5.50 per passenger to £5.88, an increase of 7 percent.

In an interview with The Telegraph, O’Leary hinted that he would launch a £2bn bid to buy Stansted Airport were the Competition Commission’s investigation recommend breaking up owner BAA.

He said acquiring Stansted was one of his two main ambitions before he ever stepped down as chief executive of Ryanair - the other being the purchase of rival Irish airline Aer Lingus.
He said: “We’d be in like a bandit. BAA knows we’re interested.” Ryanair plans to ground 15 planes from its Stansted hub during the winter in protest over landing fees.
Ryanair also cut its services at BAA-owned Stansted by a quarter, whilst simultaneously doubling its routes from its Luton hub.



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