BAA May Not Get GBP1.6 Bln For Gatwick

Ferrovial may not get the Regulatory Asset Base (RAB) value of GBP1.6 billion pounds (USD$3.17 billion) for London Gatwick airport because of credit rating concerns over the bids, The Sunday Telegraph reported without citing sources.

The paper said ratings agency Standard & Poor's has told one of the three bidders for the airport that it will not grant the required credit rating for a bid that contains debt equivalent to more than half the GBP1.6 billion RAB value.

That demand could force bidders to cut their offers before Monday's deadline for bids, the paper said.

Bidders have already said that poor traffic numbers have put the value of the airport under pressure.

Neither the bidders nor S&P would comment on the report.

Gatwick airport was put up for sale last year to meet competition concerns and owner BAA was subsequently ordered to sell London's Stansted and either Edinburgh or Glasgow airports.

The bidders are Global Infrastructure Partners (GIP), a joint venture between General Electric and Credit Suisse, which owns London City Airport; Lysander Gatwick Investment Group comprising Citi Infrastructure Partners, Vancouver Airport Services and John Hancock Life Insurance; and a third consortium consisting of Manchester Airports Group, Borealis and Greater Manchester Pension Fund.