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Thursday 21 August 2014

Plan to sell 49pc stake in airport operator hit by rows in Spanish regions

Esteban Duarte

Published 19/06/2014 | 02:30

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Spanish airports, including Madrid’s Barajas-Adolfo Suarez (above), could find themselves under different ownership
Spanish airports, including Madrid’s Barajas-Adolfo Suarez (above), could find themselves under different ownership

FUTURE investors in Spain's state-owned airport operator Aena Aeropuertos may find themselves in the middle of tensions with the country's regions as local leaders seek a say in management.

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Balearic Islands' president Jose Ramon Bauza said yesterday his government wants to jointly run airports including Palma de Mallorca.

His Canary Islands counterpart, Paulino Rivero, said he'll ask the central government to hand over control of the airports operating in the archipelago.

Catalonia's economy minister Andreu Mas-Colell said coordinated management of Barcelona and Madrid airports would break competition rules.

Prime Minister Mariano Rajoy is going ahead with the sale of 49pc of Aena, which runs 46 Spanish airports and two heliports, at a time when Catalonia – the country's largest regional economy – is challenging the central government with a planned November referendum on independence.

Aena rivals Aeroports de Paris and Fraport have full control of Paris's Charles de Gaulle and Frankfurt airport respectively.

"Shareholders could be sceptical about being subject to a double minority, not only to the central government, but also to the local governments in important airports such as Barcelona or Palma de Mallorca," said Robert Crimes, a London-based analyst at Insight Investment Research.

The government expects to sell 21pc of Aena to a group of core investors before placing 28pc in a public share sale in November, Public Works Minister Ana Pastor said at a press conference last week.

Co-management is "the best way to manage an airport," the Efe newswire cited Bauza as saying in Palma yesterday. Rivero said he will start negotiations with the central government for the transfer of the airports, according to Efe.

Barcelona's El Prat airport "should have separate management," Catalonia's Mas-Colell said in a statement.

Even though Aena has cut its debt-to-earnings ratio by about half over the past five years, it still exceeds €10bn, Aena chairman Jose Manuel Vargas told Onda Cero radio.

"It's not possible, given the company's financial structure and commitments to creditors, to split or break up the Spanish network of airports" Vargas said. "It would immediately require paying back the funds used to build the airports."

Barcelona's El Prat saw profit reach €168.3m in 2013, making it the biggest contributor to Aena Aeropuertos, followed by Palma de Mallorca with €97.6m, according to the company's website. Madrid's Barajas-Adolfo Suarez airport contributed €84.7m and Gran Canaria airport €81.4m.

Spain is restarting the privatisation of its airports as investors turn to equity markets after the yields available in the bond market fell to their lowest level since the euro was created.

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