Ferrovial set to sell off £1.3bn Budapest Airport

Published on Thursday 12 October 2006 11:47

THE new Spanish owner of Edinburgh Airport operator BAA is to sell off Budapest airport - just ten months after BAA paid £1.3 billion for it in a fiercely fought bidding war.

Ferrovial, which snapped up BAA in June, has struck a deal to dispose of Budapest's Ferihegy Airport to German construction group Hochtief for almost the same price.

Hochtief lost out on winning the airport in last December's auction and threatened to sue Hungary's APV privatisation agency, claiming BAA had not met all of the requirements.

The deal is subject to approval by Hungary's government.

At the time of the deal, BAA pledged to invest around 170 million in the airport - a figure which Hochtief will have to match to win over Hungary's ministers. When Ferrival bought BAA for 10.1bn, it made it clear it considered the firm's assets as non-core businesses.

Budapest is not the first airport to change hands this week as Celtic majority shareholder Dermot Desmond yesterday disposed of London City to a consortium led by US insurer AIG for an estimated 700 million.

Billionaire Mr Desmond bought the Docklands airport for just 23.5m in 1994.