Manchester Airport Group (MAG) has announced the acquisition of Stansted Airport from Heathrow Airport Holdings, formerly known as BAA, for £1.5bn, while competitor of the bid Ryanair announced reduction of traffic to the airport by 9% over the coming year from 12.5 million to 11.4 million. MAG is slated to takeover the Stansted Airport by the end of March 2013. The ailing Stansted Airport was put up for sale by BAA last year after Competition Commission ordered a sell-off in March 2009.
MAG has added Stansted to its existing portfolio of Manchester, East Midlands and Birmingham airports. Funding for the Stansted acquisition came from Industry Funds Management (IFM), which has a 35.5% stake in the enlarged group. The new owners of Stansted Airport pledged to take the airport, traditionally a stronghold of budget airlines, into the premier league by 2018 with flights to 40 new long-haul destinations including the US, Caribbean and the Middle East. Emirates, Qatar, Etihad, Singapore Airlines, Air France, KLM and Virgin are all set to fly out of Stansted which has been traditionally dominated by budget airlines Ryanair and easyJet.
Manchester Airport Group also promised to double annual passenger numbers 35 million, build new stands for the A380 superjumbos and spend £40m on new shops. MAG also said that Stansted’s potential could only be realised by cutting the 45-minute rail journey from central London to less than 30 minutes with new express services and by linking in to Crossrail, due for completion in 2018.
Speaking about being cautious regarding any move that directs talks towards the expansion of Stansted which is likely to raise severe opposition from local residents and environmental groups, Charlie Cornish, chief executive of Manchester Airline Group, said, “The solution for the UK is how to make better use of regional airports. I recognise in the south east you need more capacity and the next consideration is if you need a four-runway hub. The vast majority of people travel point to point and don’t need a hub necessarily. The issue in the UK is how to connect to growing and mature economies and for that you don’t necessarily need a hub.”