Wednesday, October 28, 2009

Virgin Looking At Bid For Gatwick

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Virgin Atlantic chairman Sir Richard Branson is interested in buying Gatwick Airport, according to media reports.

Gatwick is not formally up for sale but last month the Competition Commission recommended that present owner BAA should sell the Sussex airport off, along with two other sites from its 7-airport portfolio, in order to improve competition in the London airport market.

Now, Branson says that his Virgin group would be interested in bidding for Gatwick if it came up for sale.

Branson said: "We are open to being courted by anyone who is interested in bidding".

According to the Daily Telegraph, Branson has apparently been in discussions with several potential bidding partners to raise the funds for a bid.

British Airports Authority

BAA, owned by Spanish conglomerate Ferrovial since 2006, was investigated by the Competition Commission on the basis that it's ownership of seven UK airports was prohibiting competition in the airport industry.

The Commission believes that BAA owning seven airports was not in the public interest, because it limited the opportunity for improving customer service and delays - two significant criticisms of BAA.

Although it does not have the power to force BAA to sell, it is widely believed that when the Commission delivers its final report next year it will recommend that Gatwick is sold off.

Branson said: "It now looks as though they are going to break up the British Airports Authority and so they should. For the last few years they [BAA] have been an absolute embarrassment".

He added: "We have switched terminals at JFK [in New York] four times - the terminals are free to compete with each other to offer airlines better service and it helps keep down the price of tickets across the Atlantic. It demonstrates that competition works".

Macquarie Airports

Branson is one of a number of parties who have signalled interest in purchasing London's "second airport".

Australian company Macquarie Airports is said to be interested.

Macquarie is a private equity investment fund, part of the wider Macquarie investments portfolio, which holds interests in Birmingham Airport and Bristol International Airport as well as Sydney Airport.

The Manchester Airports Group, which owns Manchester, East Midlands Airport, Humberside and Bournemouth is also said to be monitoring the situation.

Source - Airport International's UK Correspondent

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