The British Airports Authority’s (BAA) faces critism by the biggest airport and airline CEOs as their monopoly over UK aviation faces further deconstruction. It follows a High Court judge ruled that there was no “apparent bias” in the sale of Gatwick Airport to Global Infrastructure Partners (GIP) in 2009.
At the beginning of last year, BAA owned seven British airports; Southampton, Stansted, Heathrow and Gatwick in England; and Aberdeen, Edinburgh and Glasgow, the three largest hubs in Scotland.
By November 2009, BAA had been forced to sell Gatwick to GIP, and was under pressure from the Competition Commission to offload Stansted and either Glasgow or Edinburgh to the highest bidder.
However, the aviation giant refused to roll over, claiming that one of the bidders on its prized London asset, Gatwick, was involved with Manchester Airports Group, one of BAA’s main competitors, hence the claim of apparent bias.
BAA’s complaint was upheld in December 2009, granting the firm a ‘stay of execution’ on the sale of its airports.
Fast-forward 10 months, and BAA is again facing the collapse of its empire, after Lord Justice Maurice Kay favoured the Competition Commission in the High Court, ruling that the possibility of apparent bias in the sale of Gatwick was so low as to be insignificant.
Battered but resolute, BAA immediately announced its intentions to take the case to the Supreme Court.
However, not everybody was unhappy to see BAA defeated – Ryanair boss Michael O’Leary criticised the aviation firm’s management style, stating that Stansted could not have a “worse owner".
O’Leary also called for the speedy sale of the Essex airport, which currently hosts 106 Ryanair routes.
The future sale of two of BAA’s largest airports – Stansted and either Edinburgh or Glasgow – would help rival firms compete in a marketplace that has historically been dominated by just one company.
Competition is likely to come from Peel Airports Ltd., owner of Doncaster, Durham and Liverpool airports, and Manchester Airports Group (MAG), which claims its namesake, Bournemouth, East Midlands and Humberside airports as assets.
MAG has also expressed an interest in buying one of the two Scottish airports currently owned by BAA and only time will tell…