BAA may sell London Gatwick to pre-empt break-up of UK operations

27 Aug 2008

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London: After some adverse remarks by the UK Competition Commission concerning its operations, UK airports operator, BAA, may now be mulling a sale of operations at Gatwick airport, according to media reports. The move may come before the regulatory body submits its final ruling next year, recommending a possible break-up of its UK operations that include control and operation of seven of the country's busiest airports.

The airports include London Heathrow, Gatwick and Stansted, Glasgow, Edinburgh, Southampton and  Aberdeen.

A report in UK paper, The Independent, quotes BAA chairman Nigel Rudd as saying that the review was "ill-thought out, inconsistent and could put back investment and expansion of Britain's airports and infrastructure by years". In this regard he said that the BAA was now looking at all options, including a sale of Gatwick.

But it was yet to decide whether it would appeal against the report's final decisions, which are due next March.

Meanwhile, British Airways chief Willie Walsh told The Guardian that breaking up BAA's ownership of major airports was not the answer to improving Heathrow, Gatwick and Stansted. He said the BAA instead needed stronger regulation by the CAA to raise service standards at Heathrow. According to Walsh, the airport owner should operate under a licence that could be withdrawn if standards were not met. "That's a big stick, but at the moment it's all carrot with BAA," he said.

Last week, the Competition Commission said that BAA should be divested of three of its seven airports, including two out of the three it owns in London.

BAA is a unit of Spain's Grupo Ferrovial.

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