Private equity circling stake in Heathrow
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Private equity firm Ardian and Saudi Arabia’s Public Investment Fund eye stake in Heathrow
- Ferrovial is considering offloading its 25 per cent stake in Heathrow
- It has been an investor in Heathrow airport for 16 years
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Ferrovial is considering offloading its 25 per cent stake in Heathrow after a chaotic summer at the airport.
The Madrid-based infrastructure conglomerate has held talks with bankers to explore a sale, with Paris-based private equity firm Ardian and Saudi Arabia’s Public Investment Fund (PIF) said to be joining forces for the stake.
Ferrovial, which also controls Spanish infrastructure developer Cintra and has stakes in motorways in the United States and Canada, has been an investor in Heathrow airport for 16 years and is its single largest investor.
If a sale to Ardian and the Saudis were to progress, Heathrow would remain in the hands of foreign investors
Other Heathrow shareholders include the Qatar Investment Authority, with a 20 per cent stake, Canadian pension fund CDPQ, Singaporean sovereign wealth fund GIC and the China Investment Corporation.
If a sale to Ardian and the Saudis were to progress, Heathrow would remain in the hands of foreign investors seeking to extract profits from a key piece of UK infrastructure.
News of a potential sale comes after a period of disorder and disruption at the airport, which has seen holidays ruined and flights cancelled.
In July, Heathrow enraged airlines when it put a cap on daily passengers of 100,000 until September 11 as it struggled to cope with labour shortages, lost luggage and mammoth queues.
Arriving passengers have described waiting for a week for their luggage. Airlines have slammed Heathrow’s decision, and British Airways has had to suspend the sales of short-haul tickets as a result.
Based on a £20.56billion valuation, Ferrovial could be in line for a windfall in excess of £500million for its equity stake, despite the recent upheaval.
Infrastructure experts have been keeping a close eye on Ferrovial’s plans for Heathrow after the group hired Luke Bugeja, a 30-year aviation industry veteran, as chief executive of its airports business in May 2021 to replace Jorge Gil.
Heathrow is one of the most regulated airports in Europe and Ferrovial has sold down stakes several times since buying a 56 per cent shareholding in 2006.
Private equity firms have been snapping up key infrastructure assets during the pandemic. Yesterday Australian investment bank Macquarie spent £2billion on the UK business of recycling group Suez from French group Veolia.