The European Commission has approved the proposed acquisition by Global Infrastructure Partners from its current owner, BAA of Gatwick Airport, the UK’s second largest airport.
According to a statement from the Commission, after examining the operation, the Commission concluded that the transaction would not significantly impede effective competition in the European Economic Area (EEA) or any substantial part of it, and thus does not infringe on EU merger regulations.
Global Infrastructure Partners (GIP) is a private equity fund which invests in infrastructure and infrastructure-related assets, is managed by Global Infrastructure Management LLC and is jointly controlled by General Electric Company and the Credit Suisse Group. Its portfolio includes a 75% joint ownership interest in London City Airport.
The Commission’s examination of the proposed transaction showed that the horizontal overlaps between the activities of London City airport and Gatwick airport were limited and that, therefore, the transaction would raise no competition concerns.
It explained that London City is mainly a niche airport focusing on short haul flights for business passengers, while Gatwick is a large airport serving predominantly leisure passengers.
This transaction was initiated following the outcome of an investigation of the UK Competition Commission into the airport services market in the UK.
On March 19, 2009, the UK Competition Commission published its final report with respect to this investigation and required BAA, which controls several airports in the UK including Heathrow and Stansted airports, to divest inter alia Gatwick Airport.
On November 5, 2009, the UK Competition Commission gave its final consent to GIP as a suitable buyer of Gatwick.
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