A GROUP of Scottish business leaders are preparing a bid of up to £1 billion for either Glasgow or Edinburgh airport.
It is understood that investment banker Ben Thomson and former Edinburgh airport boss Richard Jeffrey, who recently quit the trams firm TIE, have approached other senior figures and have held preliminary talks with international investors over raising finance.
BAA, owned by Spanish firm Ferrovial, is expected to announce this week the formal process for selling either Glasgow or Edinburgh and it could decide which one it wants to offload.
The Competition Commission last week ordered the company to sell one of its Scottish airports ahead of Stansted, which remains the subject of a legal challenge by BAA.
It is thought that Glasgow would command a £500m price tag while Edinburgh would attract between £700m and £1bn. BAA has been concerned at the timing of a sale at a time of reduced valuations and there is speculation that it could even put both on the market to test the market’s appetite.
Both airports are regarded as well-managed and one person familiar with the bid proposal described the auction as a “once-in-a-generation opportunity”.
Approaches have been made to global investors, who are said to have given a positive response to backing an independent bid. Investors consider British airports to be an attractive investment, with good growth potential.
Laurie Price, head of aviation strategy at consultancy Mott McDonald, believes Glasgow is the more likely to be sold as Edinburgh is growing faster and does not face competition from a nearby rival as Glasgow does in fighting for customers with Prestwick.
John Strickland, of JLS Consulting, reckons BAA may want to hold to on to Edinburgh and Heathrow as two strong assets.
The forced sale of the airports has been hugely controversial. It began in June 2006 with the launch of a study into BAA’s dominance of the UK market by the Office of Fair Trading. There have been a number of legal challenges through appeals tribunals and the Supreme Court.
It emerged last week that the owner of Prestwick may be willing to listen to offers. New Zealand-based Infratil could put it on the market just ten years after it was bought from Stagecoach for £33.4m.
This has prompted speculation that Glasgow may try to lure Ryanair from its Ayrshire rival.
Ferrovial last week sold 5.88 per cent of BAA to US infrastructure investment group Alinda Capital Partners for ¤325m (£283.7m), valuing BAA at £4.8bn. The deal removed BAA’s debt from its balance sheet.