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Marcus Balmforth: An early coup for the new GE airports man |
UK. A powerful US consortium has agreed to purchase the prospering London City Airport for an undisclosed sum.
The Docklands airport has announced that AIG Financial Products Corp, which is a wholly owned subsidiary of insurance giant American International Group Inc, and Global Infrastructure Partners – a joint venture between GE Infrastructure, part of General Electric Corp (GE), and Credit Suisse – will each acquire a 50% share from Irish billionaire owner Dermot Desmond.
Desmond bought the airport in 1995, eight years after it opened, for £23.5 million, though media reports in London suggested that this sale could be worth up to £750 million.
Offering departures to 29 destinations from 15 different airlines, City Airport serves many parts of continental Europe and the UK. Having had an annual passenger total of less than 730,000 in 1996, the airport handled almost two million passengers last year – and it is predicted this figure will rise to 2.4 million in 2006.
With the countdown to the Olympic Games well under way, the airport’s east London location – only 14 minutes from the planned Olympic Park, on the newly extended Docklands Light Railway – means there is obvious potential for further growth. An estimated 3.5 million passengers are forecast to be using the airport by 2012.
The deal remains subject to European Union merger clearance and is expected to close in November.
The news follows last month’s announcement that General Electric subsidiary GE Infrastructure had appointed former Macquarie Airports and BAA executive Marcus Balmforth to head a major push into the airports investment sector.
Balmforth, who until recently served as Macquarie Airports (MAp) Division Director responsible for European airports, now leads the powerful GE Infrastructure’s airport efforts worldwide within its GE Commercial Aviation Services (GECAS) unit.
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