Heathrow owner slashes debt through stake sale

Oct 11, 2011 07:50AM GMT

Ferrovial, the Spanish majority owner of BAA, has sold almost 6% of the UK's leading airports operator for €325 million in a move that slashes its debt burden.

The sale to investment group Alinda Capital Partners leaves infrastructure company Ferrovial with a 49.99% holding in BAA, owner of Heathrow, Stansted, Glasgow and Edinburgh airports.

The sale of the 5.9% stake, less than an originally planned 10%, implied a total value for BAA of €5.52 billion (£4.7 billion), substantially less than the £10.3 billion Ferrovial paid for the airport operator in 2006. However, it is more than 2.5 times the value analysts have placed on BAA.

The company has already recouped £1.5 billion from the sale of Gatwick airport two years ago.

Ferrovial chief executive Iñigo Meirás Amusco said: “We wanted to put a real market value on BAA, as before it was low and now we have value more than double market expectations."

By trimming its shareholding below 50%, Ferrovial will be allowed to remove BAA debts from its accounts, cutting its net debt from €19.7 billion to €5.2 billion.

BAA is poised to announce which of Edinburgh or Glasgow airports it is to sell following a ruling by the Competition Commission. It remains under an order to dispose of Stansted, but has lodged a further appeal.

The operator sold Gatwick in 2009 for £1.5 billion to a consortium led by Global Infrastructure Partners ahead of being ordered to do so by the Competition Commission.