Ferrovial adds to Heathrow uncertainty amid warnings over returns
Heathrow owner Ferrovial has added to the uncertainty over the airport’s long-awaited third runway by saying it might consider selling the asset if it could not get an “adequate return” on its investment.
The Spanish infrastructure firm, which owns UK outsourcer Amey, currently owns a 25 per cent stake in Europe’s busiest airport.
However, chief executive Ignacio Madridejos reportedly told investors last week that the firm “may rotate the asset” if “regulation is at a level where we cannot get an adequate return”.
The rate of Ferrovial’s return from the airport is said by industry watchdog the Civil Aviation Authority (CAA), which sets price controls for Heathrow’s licenses.
The tariffs are meant to be updated every five years, but the regulator has extended the current rules by two years in anticipation of the expansion, which is meant to be completed by 2029.
The controversial project received governmental sign-off in 2018, but must still surpass several obstacles.
Get the news as it happens by following City PM on Twitter.
In December the CAA rejected Heathrow’s request to lift spending from £650m to £2.4bn over concerns that members of the public may end up shouldering the cost.
A spokesperson for Ferrovial reinforced the firm’s commitment to the airport, saying: “We are happy with our stake in Heathrow and the opportunities an expanded Heathrow presents for all stakeholders.
“We are confident the regulator will create a framework to encourage and incentivise investment. If the regulatory outcome does not provide a suitable return, we will consider alternative options to expanding Heathrow.”
Madridejos added: “Heathrow is a huge asset for us. There will be 4bn more airplane passengers [globally] in the next four years”.
Christmas saw Heathrow’s busiest ever December, with 6.7m passengers travelling through the airport over the holiday season.
The seasonal surge was part of a record 2019 in which the airport welcomed a record 80.9m passengers to notch a ninth consecutive year of traffic growth.