Fraport acquires 24.5 per cent of Xi'an airport in China

Beijing: Frankfurt airport operator, Fraport, has signed an agreement that will allow it to assume a 24.5 per cent stake in Xi'an airport, capital of the Shaanxi province of China. Fraport will pay $66.83 million for the stake. After Beijing, Xi'an is China's second biggest tourist city, and also the starting point of the fabled Silk Route.

With the agreement, signed Friday last week, Fraport becomes the first foreign airport operator to invest in a Chinese airport that is not listed on the stock exchange. The agreement will allow Fraport to take charge of the airport's operations and commercial development. The transaction is expected to be complete by the third quarter of 2007.

The airport's previous owner, the state-owned China West Airport Group, will retain its majority shareholding.

Xi'an has a population of about 7.2 million and was once China's first imperial city. The city is especially known for its 2,000-year old terra cotta warriors.

The Xi'an Airport handled about 9.4 million passengers in 2006 and expects to handle almost 11 million passengers in the current year. At present the airport has only one runway but there are plans to add another one and expand the passenger terminals as well.