Airport operator BAA is in discussions with a number of parties regarding the sale of Gatwick Airport, despite press reports that the sole bidder in the auction has dropped out.
A report in the Financial Times yesterday said that the last remaining bidder in the process – a consortium comprising Manchester Airport Group (MAG) and Canadian infrastructure investor Borealis – had withdrawn from the process. According to the report, the consortium had refused to raise its £1.4 billion (€1.6 billion; $2.3 billion) bid in order to meet BAA’s £1.5 billion asking price, which is still short of Gatwick’s £1.58 billion Regulated Asset Base.
However, today BAA told Infrastructure Investor that discussions with “a number of bidders” are ongoing.
One source close to the situation suggested the MAG consortium was using the press as part of a strategy to negotiate better terms, adding that it is still very much interested in the West Sussex airport.
In May, rival bidder Global Infrastructure Partners was reported to have been eliminated from the bidding after having a fully-funded bid rejected, leaving the MAG and Borealis consortium apparently the only candidate still standing. The Citigroup-led Lysander Investment Group had previously been eliminated from proceedings after submitting a bid which BAA described as undervalued and uncompetitive.
BAA is currently appealing against a Competition Commission report which recommended that it sell Gatwick, Stansted and either Glasgow or Edinburgh airports.