Hellish winds of change seem to be blowing lately over London’s biggest airports. News land in one after the other in UK travel industry; Heathrow personnel still striving to short out Terminal 5 while “stray” rumours spread around regarding construction plans of a second runway in Gatwick airport. Worse was yet to come though, as discussions over a Gatwick sell-off escalated yesterday.
It is no secret BAA is a hair’s breadth away from collapsing into pieces, surely bound to drug down the hill their Spaniard conglomerate owner Ferrovial. You see the Spanish company carries a £23 billion burden, directly related with borrowings accompanying the BAA acquisition, which actually stocks up around £900 million from interest added up every year. So, while Ferrovial sweats over covering interest payments its bankers - RBS and Citi - are called up to inject an additional £11 billion for BAA’s debts.
It may sound strange to say that for a giant like Ferrovial, but it looks like they might end up out of cash half 2009, according to financial analysts, if action is not taken. Therefore, since they already started lashing randomly around potential liable executives, the loveable BAA CEO was the first to take the hit and got the suck. It was dead obvious that Stephen Nelson was the join the scapegoat club of sucked top directors from huge companies following recent global turmoil.
Things aren’t made easier on Ferrovial’s effort to keep BAA together and maintain Gatwick ownership as the UK Competition Commission raised concerns regarding BAA’s near-monopoly in the south-east region. The final decision won’t be released before summer, nevertheless a Gatwick see-off would definitely do the trick at least in the short term. BAA’s situation worsened greatly as Heathrow Terminal 5 was ironically anticipated like “mana from money heaven” to bring in some extra cash…