BAA today complained that proposals to introduce a “special administration regime” for London’s Heathrow, Gatwick and Stansted would create additional uncertainty for investors and drive up the cost of airport finance.
The Department for Transport is considering introducing such a regime to safeguard operations if an airport operator goes bust. Similar schemes already exist for power and water supplies.
UK airport regulator the Civil Aviation Authority on Friday backed the BAA in its own response to the government’s plans, arguing that the special administration regime was unnecessary and the government’s ideas blurred the line between regulator, user and investor, leading to confusion and uncertainty.
Bondholders to BAA, owed 4.5 billion pounds, are watching the situation closely, worried their rights will be trampled on. Meanwhile, Gatwick bidders and prospective Stansted buyers will also be keeping the UK government on the radar, checking to see if mounting pressure leads to a last minute change in course.