Ferrovial confirms Belfast's George Best airport for sale

THE SPANISH group Ferrovial has confirmed it wants to sell George Best City Airport in Northern Ireland.

Brian Ambrose, the airport's chief executive, said Grupo Ferrovial was looking at "strategic alternatives" which could result in the sale of the airport which it has owned since 2003.

The confirmation that the airport is for sale comes less than a month after management in Belfast strongly denied there were any plans by Ferrovial to dispose of it.

The Spanish group operates seven airports in southeast England and Scotland. This includes BAA, which operates the Heathrow, Gatwick and Stansted airports in London.

Britain's competition commission has expressed concern about the ownership of these key airports by one organisation, prompting speculation that Ferrovial may be forced to sell one or more of them.

The Spanish group is also struggling with a debt burden of more than £23 billion.

There have been suggestions that one way it could reduce this net debt would be through the sale of the airport, which was renamed after Belfast-born footballer George Best in 2006.

Ferrovial purchased the airport from the Canadian group Bombardier for £35 million. Over the last five years, it has invested more than £30 million in upgrading the Northern Ireland operation.

Industry analysts estimate George Best City Airport could now be worth £100 million to £150 million and is likely to attract a wide range of bidders, including existing airport operators such as the private equity group Bridgepoint, which owns Leeds Bradford airport, or the venture capital firm 3i, which has investments in the North.

The former owners of Belfast International Airport, HG Capital, might also be interested in re-establishing its relationship with Northern Ireland.

There has been strong speculation that the investment bank JP Morgan might be among the interested parties while the construction firm Balfour Beatty has also been headlined as a possible bidder.

George Best City Airport has been steadily growing its business since it was purchased by Ferrovial.

Passenger numbers are expected to rise to more than 2.7 million this year, boosted in no small way by Ryanair's decision to establish its 23rd European base at the airport last October.

It is also in the process of applying for planning permission to extend its runway by 600m.

Current legal restrictions limit the models of aircraft which can use the runway and restrictions apply to the number of passengers that aircraft can carry on take-off.

Ryanair operates Boeing 737-800s aircraft which have 189 seats but it is only allowed to carry 140 passengers on take-off.

If the airport secures planning permission to extend the runway, it would be more attractive to its existing operators and encourage other airlines to consider it as a base for new routes to potential European destinations.

Mr Ambrose stressed yesterday that it would be months before any decision was taken about the airport's future.

In the meantime, he said, the possibility of a sale would not affect its day-to-day business.