Low-cost carrier Ryanair in talks about taking a stake in Stansted airport

 

Tom Bawden
Tuesday 21 August 2012 21:47
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Ryanair, the low cost carrier, said it was interested in buying a 25 per cent stake in London Stansted airport, which is up for sale for an estimated £1bn.

The company, which is Stansted's biggest customer, operating 41 planes from the airport, indicated its interest after its current owner, BAA, ended a protracted legal battle to prevent its sale, which had been ordered by the Competition Commission in 2009.

It admitted in a Stock Exchange announcement yesterday that it has held discussions "with a number of parties who are interested in bidding for Stansted".

The airline added: "In some of these discussions Ryanair has confirmed that it is willing (subject to a competitive cost offer) to deliver traffic growth at Stansted over a five-year period and has been asked to consider acquiring a minority stake (of less than 25 per cent) should a successful consortium consider it necessary or valuable to commit Ryanair to Stansted airport as a minority equity investor."

Ryanair first revealed its interest in Stansted airport in April, when the airlines chief financial officer, Howard Millar, said "if a consortium wants us in as a shareholder we would consider it."

Yesterday, a Ryanair spokesman said: "We are still interested in taking a stake in the airport. Our long-term strategy for Stansted offers potential for growth. The sale of Stansted will lead to more competition [and] improved passenger numbers."

The no-frills airline welcomed the decision to sell Stansted by BAA, with whom it has had a number of disputes over the years, mainly revolving around potential charges at London's third largest airport. An attempt in the mid-1990s to build a second runway at Stansted was described by Ryanair as "gold-plated folly" that risked turning Stansted into a white elephant.

Although Stansted has seen passenger numbers fall in recent years – which Ryanair's combative chief executive Michael O'Leary blames on rising airport charges – Ryanair has come round to the idea of expansion there, now seeing it as the obvious place to accommodate a new runway in the South-east.

Potential bidders for Stansted include Manchester Airports Group, pension funds and infrastructure funds.

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