BAA has put Gatwick Airport up for sale, conceding that the Competition Commission’s recommendation of its break-up is inevitable.
Gatwick, which is Britain’s second largest airport, could fetch up to £2bn. Potential bidders include Richard Branson, who is thought to be in talks with several bidding partners including the Dubai royal family.
The Virgin Atlantic boss said two weeks ago he would be “open to being courted by anyone who is interested in bidding” for Gatwick Airport.
The owner of Manchester Airport, Manchester Airport Group, has also formed a bid team are approaching potential investors for Glasgow as well as Gatwick, although it has said the airports were overvalued.
Colin Matthews, BAA’s chief executive, said: “We have decided to begin the process of selling Gatwick Airport immediately. Gatwick is one of Europe’s premier airports, the busiest single-runway airport in the world, and it was used by 35 million passengers last year.
“Gatwick has long been an important and valuable part of BAA and the decision to sell was not taken lightly. We believe that the airport’s customers, staff and business will benefit from the earliest possible resolution of current uncertainty.
BAA was expected to appeal against the break-up. Colin Matthews, BAA’s chief executive, said today: “When the Competition Commission published its provisional findings, we said that we would be realistic in our response, though we disagree with the Commission’s report and the analysis on which it is founded.
“We will continue to present our case, in respect of the South East airports and those in Scotland. At Stansted, we believe that a change of ownership would interfere with the process of securing planning approval for a second runway, which remains a key feature of Government air transport policy.
“The Commission itself states that a shortage of runway capacity in the South East is a main cause of poor service standards, but we believe its proposed remedies will delay delivery of that capacity.
Profits at BAA’s seven airports more than halved in the first half of this year as the global downturn, higher security costs and the fiasco of the Terminal 5 opening, took their toll. The group yesterday posted a slump in passenger figures for August.
easyJet, Gatwick’s largest airline, has criticised the decision, saying Gatwick is a local monopoly and simply selling it to the highest bidder won’t change that fact. It argues that monopoly providers of nationally-important infrastructure always need to be regulated to prevent irresponsible pricing.