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Scottish government plans to nationalise Infratil's unprofitable Glasgow Prestwick Airport

Wednesday 9th October 2013

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The Scottish government plans to nationalise Infratil's unprofitable Glasgow Prestwick Airport, which the Wellington-based investment company has been trying to sell since March last year.

Deputy First Minister Nicola Sturgeon told the Scottish parliament that she hoped to agree terms of a sale within six weeks

"We believe that Prestwick airport can have a positive future," she said in a statement. "It will require investment and take time, but we believe that it can be returned to profitability."

She said that despite considerable effort and interest from private investors, a deal hadn't been achieved for Infratil to sell the airport "in a timescale that is acceptable to Infratil."

As a result, she said, Infratil was considering other options including public sector ownership or closing the facility. The second option would be "a serious and unwelcome development both for Ayrshire and the Scottish economies," she said.

Infratil said in a statement there has been an exchange of letters with the Scottish government. It put Glasgow Prestwick and Manston Kent Airport up for sale in March last year and in May this year, wrote down their value to 11 million pounds. Brokerage First NZ Capital in a report this week ascribed zero value to the company's Infratil Airports Europe business, previously valued at $15 million.

"The divestment process for Manston Kent Airport is on-going, and Infratil remains committed to exiting this investment in the near term," Infratil said. The company "does not now expect any transaction completed for Glasgow Prestwick Airport or Manston Kent Airport to give rise to material proceeds."

BusinessDesk.co.nz



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