Price of Prestwick and Manston slashed to just over one fifth the price Infratil paid for them in 2003 and 2005
The value of Prestwick Airport has fallen to under a quarter of its level 2 years ago as owner Infratil struggles to find a buyer. The New Zealand-based company yesterday put the value of Prestwick and Manston Airport in Kent at £10.5 million. They had been valued at £32m earlier this year. Infratil bought Prestwick for £33.4m in 2003 and it bought Manston for £17 million in 2005 (so a total of £50 million). A valuation carried out at the end of the financial year in March 2011 said the airports were worth £44m. Both airports were put on the market in January when Infratil said they were under-performing. It had been hoped a sale would be completed by early next year but no buyer is forthcoming. Passenger numbers at Prestwick have dropped to just under 1.1 million a year – less than half the level of 3 years ago – as Ryanair, which provides the bulk of passenger flights, has relocated many services to Edinburgh. The lack of investment has left Prestwick looking tired and off-putting to potential buyers.
Prestwick value slashed
THE value of Prestwick Airport has plummeted to less than one-quarter of the level it was at two years ago as owner Infratil struggles to find a buyer for the Ayrshire site.
Both airports were put on the market in January after their parent company said they were under-performing. It had been hoped a sale would be completed by early next year.
Passenger numbers at Prestwick have dropped to just under 1.1 million a year – less than half the level of four years ago – as budget airline Ryanair, which provides the bulk of passenger flights, has relocated many services to Edinburgh.
The latest devaluation follows warnings in September by Ayrshire MP Brian Donohoe that the lack of investment had left Prestwick looking tired and off-putting to potential buyers.
He said the latest statement by Infratil, carried out ahead of interim financial statements next week, showed there was a need for investment. “I’d like it to be sold for a pound, frankly, seeing as they’re losing money there,” he said.
Mr Donohoe added: “I want someone to come in with the clear understanding that investment is needed. They need to invest £10m in the airport – and sooner rather than later. It’s only when that investment happens that you will get one of the big charter airlines coming in.”
Infratil’s purchase of Prestwick from Stagecoach for £33.4m in 2003 was overseen by the aviation consultancy MPD Group. John Baillie, operations director at the consultancy at the time, said: “Infratil has written down the value of the asset on its balance sheet, which would appear to be a reaction to the lack of interest from the market in the airport.”
Infratil said in its statement: “Infratil continues to actively seek a buyer for the airports, while considering all other options available with respect to the ongoing operations.”
Passenger downturn prompts slump in Prestwick airport’s valuation
August 25, 2005 (Financial Times)
Infratil to buy Manston airport from administrator
Kevin Done, Aerospace Correspondent
Infratil, the New Zealand-listed infrastructure fund, has agreed to take over London Manston airport for £17m from the administrator of the bankrupt Planestation group.
Infratil is seeking to expand as an operator of regional airports in Europe.
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It already owns Glasgow Prestwick airport, which has been growing rapidly as the Scottish operating base of Ryanair, the leading European low cost airline, and it has also been in protracted negotiations to take over Lübeck airport in northern Germany.
Ryanair has announced that it would also like to establish a base at Lübeck, but the deal is conditional on its partner, Infratil, being successful in its plan to acquire a 90 per cent stake in the airport and to win approval to extend the runway. Planning permission for the runway extension has so far been blocked by a temporary injunction in the local courts.
Infratil also owns a 66 per cent stake in Wellington airport, New Zealand.
The group said it believed that Manston airport, which trades as Kent International airport, had “strong prospects” as a freight airport servicing the south of England and said it had already had informal talks with a number of freight operators who were “keen” to start services to Manston.
It said the airport, which is located near Ramsgate,110kms east of London, was also well placed to provide regional passenger services to Kent and the eastern side of the London catchment area with 1.9m people within a 60 minutes drive.
The financial collapse of the Planestation group followed its foray into the airline industry and its takeover of EUjet, an Irish start-up low cost carrier which began European and domestic services at Manston in September last year.
The group including EUjet collapsed into administration last month with Grant Thornton appointed as administrator. EUjet left around 5,400 passengers stranded without return flights and a further 90,000 with advance bookings, that could not be fulfilled.
The administrator said that unlike Planestation, Infratil would not “be buying and operating an airline themselves.”
Steven Fitzgerald, Infratil Airports Europe chief executive, said it would take “some time” to make Kent International profitable, as it currently had no services. Flying operations were suspended by the administrator.
He forecast that the airport would reach an operating surplus “within three to four years”. In the first three years capital expenditure was forecast to total £9m with operating losses estimated at £8m to £10m.
He said that both Manston and Prestwick were set up to service the fastest growing air transport segments, air freight and low cost airlines. Manston had a 2,752m runway, that was capable of servicing both Boeing 747s and Airbus A380s.