Auction of BAA airports edges closer

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The break-up of BAA, the airport operator that owns Heath- row and Gatwick, will move a step closer this week when the Competition Commission recommends selling key assets.

The commission has been investigating BAA's market dominance in the South-east and Scotland since March last year, but this will be the first time it offers solutions. However, an "emerging thinking" report in April hinted that auctioning airports was under consideration.

Ferrovial, the Spanish conglomerate that owns BAA, is ready to fight back over the findings during a series of hearings with the commission next month.

A source close to Ferrovial said: "We will suggest that the main problem in these markets is one of airport capacity."

But Ryanair's boss, Michael O'Leary, said a second terminal at Stansted would cost 10 times less if built by an owner other than BAA.