KSA’s PIF set to grab 10% stake in loss making Heathrow airport: Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), is set to grab a 10% stake in London’s Heathrow airport as Spanish infrastructure company Ferrovial looks to offload stakes in the one of Europe’s busiest travel hubs, a statement by the PIF read.

What we know: Ferrovial said it will be selling its entire 25% stake in FGP Topco, the airport’s parent company, for GBP 2.4 bn, according to a statement. It named the buyers as the PIF, which will be acquiring a 10% stake, and Paris-based equity firm Ardian which will be acquiring a 15% stake through separate vehicles, it said.

The transaction is still subject to complying with the Right of First Offer (ROFO) and prerogatives that could be exercised by other Topco shareholders, PIF said. It will also need to clear regulatory conditions, it added.

Qatar’s sovereign wealth fund also holds stakes in Heathrow: The airport’s shareholders includeQatar Investment Authority, which owns a 20% stake, Singapore sovereign wealth fund GIC and the Australian Retirement Trust, each holding a 11.2% stake, and others.

Ferrovial has been divesting bits and pieces: The Spanish company had an initial stake of 56% in Heathrow but it had to lower it to 25% by 2013. Aside from Heathrow, it owns a 50% stake in UK’s Aberdeen, Glasgow and Southampton airports. Its airport ownerships also stretch further overseas, owning 60% of Turkey’s Dalaman and a 49% stake in New York’s JFK airport’s Terminal 1.

Heathrow had it coming: Ferrovial executives have reportedly been dissatisfied with the British regulatory scene after Heathrow was obliged to slash its landing charges by almost a fifth on the back of a conflict with airliners, the Financial Times reported. The airport continued to run losses this year on the back of higher servicing costs on its significant debts due to rising interest rates. Heathrow’s losses come despite a recovery in passenger numbers to pre-pandemic levels. The travel hub received 59.4 mn passengers in the first nine months of the year, up from 34.4% y-o-y. It also handled 1.02 mn metric tonnes of cargo during the same period, down 0.02% y-o-y, according to the airport’s tracking data (pdf).

The story is getting wide coverage fromReuters | Bloomberg | Sky News | BBC | The Guardian | The Financial Times.

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