BAA wins the right to keep hold of Edinburgh Airport

Published on Thursday 19 March 2009 09:22

COMPETITION watchdogs today stepped back from ordering BAA to sell Edinburgh airport.

Instead, the company will be given a choice of disposing of either Edinburgh or Glasgow in a bid to make air travel to and from the central belt more competitive.

BAA said it was "disappointed" the Competition Commission was still insisting it must sell one of its Scottish airports, but welcomed the fact it would now be allowed to decide which one.

Insiders said BAA was likely to try to keep Edinburgh airport and sell Glasgow, but the market preference for the Capital operation could mean it that it will no choice other than to sell Edinburgh in the end.

The commission's report, following a two-year investigation into the airport operator, said Spanish-owned BAA must sell three of its seven UK airports. London's Gatwick airport is already up for sale. Stansted and either Edinburgh or Glasgow will have to follow within two years.

"We are confident that the sale of these airports will bring substantial benefits to passengers and airlines," said Christopher Clarke, who chaired the inquiry.

BAA also operates Heathrow, Southampton and Aberdeen airports.

In an interim report in December, the commission caused a surprise by specifying Edinburgh should be the Scottish airport to be sold. It sparked fears that the sale could attract a low-cost airport operator who would not invest in the same high standard of facilities.

BAA bosses and Capital business leaders argued the commission was going too far in ordering which airport should be sold.

BAA has the right to appeal against the decision, and today, Gordon Dewar, managing director of Edinburgh Airport said: "BAA Scotland will consider the terms of the Competition Commission's report before deciding how to respond."

He added: "We continue to believe that the commission's analysis of the Scottish airports market is misguided and its remedies may not be practical in current economic conditions."

An industry insider said: "There is a desire within BAA to keep Edinburgh. However, because it is a forced sale and must take place within two years, it is not all down to choice. If there is a buyer willing to pay for Edinburgh but not Glasgow, Edinburgh would then become the more likely to go."

&#149 Edinburgh airport managing director Gordon Dewar is calling on the Scottish Government to revive the Route Development Fund which subsidised new air routes to Scotland.

He said the extra funding was vital to help Scottish airports compete with rivals around Europe.