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TheMoodieReport.com: "Civil Aviation Authority warns BAA suitors that airport investment must be factored into financing � 24/02/06
Source: �The Moodie Report
By Martin Moodie
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UK. The Civil Aviation Authority (CAA) warned today that any would-be bidder for airport operator BAA should take into account when financing any deal the projected large airport investment required in the future.

Spanish construction group Ferrovial announced on 8 February that it was considering a consortium-driven takeover of BAA.

BAA is currently developing a fifth terminal at Heathrow. It is also planning to build a second runway at London Stansted and redevelop Heathrow Terminal 2.

The CAA is the regulator of UK airports that have been designated by the Secretary of State for price controls and certain public interest issues under the Airports Act 1986. It is undertaking a review of caps on airport charges at BAA�s three designated airports (Heathrow, Gatwick and Stansted) for the period 2008-13.

It issued a consultation document called �Airports Regulation: Price Control Review � Consultation on Policy Issues� in December 2005. The CAA said today: �It is for the current or any future owner of designated airports to ensure that they take account of this ongoing review, which is currently at an early stage.�

It added: �The CAA will set caps on airport charges in accordance with its statutory duties and not in order to accommodate any particular financing arrangements adopted. In this context, it is particularly important that in making financing arrangements airport operators recognise the significant near- and medium-term investment required to upgrade airport facilities and accommodate a continuing increase i"