Virgin could vie with MAG for Gatwick

MANCHESTER Airports Group may face competition from Sir Richard Branson’s airline Virgin Atlantic in bidding for Gatwick Airport.

The Virgin group has confirmed its interest in the London gateway as part of a consortium.

It has reportedly held talks with several possible partners over Gatwick, which could be sold after the Competition Commission told owner BAA it may have to offload three of its UK airports.

Gatwick – Britain second biggest airport which handles more than 34 million passengers a year – could fetch more than £2bn if an auction goes ahead.

MAG, which operates Manchester, Bournemouth, East Midlands and Humberside Airports, said it could be interested in acquiring `one or more’ of BAA’s gateways.

Jonathan Bailey, the group’s head of external affairs, has formed an acquisitions team.

MAG is known to be interested in Glasgow, where it could face a battle with the Dutch-based Schiphol Group. MAG is also taking a look at Edinburgh Airport as well as Gatwick.

A bid for Gatwick would require a partnership with private equity or other investors, but it could probably afford to buy Glasgow or Edinburgh independently. With BAA now owned by Spain’s Ferrovial, MAG is the largest British-owned airports operator.

The Competition Commission proposed in a preliminary report that BAA divest itself of two of its three London airports.

The competition watchdog made it clear that it was unlikely to require Heathrow to be sold, which could leave Gatwick and Stansted on the sale block.

It also recommended that BAA lose control of either Edinburgh or Glasgow airport, but a final report is not due until the end of the year.

A Virgin Atlantic spokesman said: “Virgin Atlantic would be interested in possibly bidding to run it, as part of a consortium.

“We would be able to bring our expertise in customer service into any ownership group.”

The carrier, which has long called for an airport shake-up in the UK, said its experience with the National Air Traffic Services (NATS) public-private partnership suggested a consortium ownership of Gatwick could succeed.

“We are a shareholder in the air traffic control company NATS, which we part own with other airlines, and could imagine a similar scenario in terms of Gatwick’s ownership,” said the spokesman.

Virgin Atlantic has reportedly already been in contact with funds backed by the Dubai royal family for a joint bid.