Aer Rianta could be set to raise up to €250 million in fresh funding via the capital markets, it has emerged.
The company has invited expressions of interest from European and Irish banks and investment houses to arrange funding of between €125 million and €250 million.
The most likely option is a bond of up to €250 million. It is needed to pay for developments at Cork airport and the Pier D facility at Dublin. Expansion of its runway space is also planned.
It is not clear whether the company intends to raise the money in one instalment or in several tranches, although a tender notice issued yesterday refers to funds being raised over a three year period.
The company already has a credit rating from Standard & Poors. Earlier this year this agency said its negative outlook would remain until a range of issues were resolved, including the question of an independent terminal at Dublin Airport.
The company's net debt is heading towards €400 million, but with Cork expected to cost between €120 and €140 million and Pier D likely to cost €70 million, the company badly needs to raise fresh capital.
The company has also committed itself to spending at least €100 million on a new runway.
Because of a determination by the airport regulator Mr William Prasifka, the company is only allowed to raise a certain level of finance via airport charges.
Some of Aer Rianta's opponents have accused it of "gold plating" by spending such large sums on big infrastructural projects.
However the company has warned that unless it expands to meet forecast traffic growth the country's airports will not be able to accommodate tourist business.
Meanwhile talks were taking place last night at Liberty Hall in Dublin among union leaders in relation to the future of Aer Rianta.
Among the issues to be discussed was whether Aer Rianta workers should participate or take a shareholding in the Omega Air plan for a new terminal.
This plan, being promoted by Messrs Ulick and Desmond McEvaddy, envisages a new €400 million terminal to the north of the existing airport.
If the workers are given a stake in the project they might then endorse the Omega Air plan, although at this stage all proposals are "very tentative" said sources.
Last week Mr Ulick McEvaddy suggested Aer Rianta itself could get involved in any new terminal, either as a partner or as the company managing the facility. However all these plans would need the blessing of the Minister for Transport, Mr Brennan.
Mr Brennan is most likely to bring forward proposals later this month on Aer Rianta, although with CIE unions planning a "no fares" day next week the Minister may have to postpone action on Aer Rianta.
The Minister plans to break up the company into three constituent airports: Dublin, Shannon and Cork. He believes that when operating on their own the airports will compete with each other and Dublin's natural dominance can be reduced.
However local groups in Shannon have serious concerns about the airport's future, particularly if the Shannon stopover comes to an end.
The US and the EU are expected to meet in the new few months to draw up a new agreement which will lead to an "open skies" policy.
Meanwhile one of the world's largest carriers Air France said yesterday its June passenger traffic edged down 0.1 per cent compared to the same time last year. However its Asian network showed signs of recovery from the effects of the SARS virus.
