UK's Competition Commission may compel airports operator, BAA, to shed assets
16 Aug 2008
Indications are that UK airports operator, BAA, may be stripped of a number of its assets, including two of its three London airports, through recommendations made by the country's competition watchdog. Persistent media reports indicate that the provisional findings of the UK's Competition Commission's, to be submitted next week, may include recommendations to strip it of all but one of its Heathrow, Gatwick and Stansted operations.
UK's Competition Commission has been conducting a 16-month probe into the structure of the BAA, and its near market dominance, in the areas in which it operates. Spanish firm, Ferrovial-owned BAA has a network of seven British airports, including those that are termed near-monopolies in the south-east of the country as well as Scotland.
According to Commission statistics, BAA holds a 60 per cent market share of all passengers passing through British airports, rising to 84 per cent in Scotland and 90 per cent around London.
Ferrovial had purchased BAA for more than £10bn less than three years ago.
Customers, and also critics of BAA, such as Ryanair, have persistently charged the operator with providing sub-standard, and costly, service. They have said that BAA's dominance of the market is disastrous for passengers.
Apart from advising sale of London airports, by way of easing BAA's grip on the market, the commission may also compel BAA to sell either the Glasgow or the Edinburgh airport in Scotland, in a bid to ease its grip on the market.
