|
|
The new solvency rules for the big airports have been diluted by British government, with plans for special administration regime to ensure airports stay open even if their operators go kaput, being dropped.
The earlier plans of the government would have resulted the investors in airport infrastructure projects demanding higher returns, which would have increased the cost related to the financing of development projects.
"The government has concluded that the implementation costs of introducing Special Administration would outweigh the benefits, and could significantly restrict airport operators' ability to commit to ongoing investment in the airport infrastructure," the Department of Transport said.
This plan is definitely a boost for airport operator BAA, which operates Heathrow, Gatwick and Stansted, which had faced the risk of downgrading if the original plan had been implemented.
"We view this is an extremely important de-risking event," said a Macquarie Equities Research analyst in a note to clients.
BAA said the revised proposal "removes key uncertainties for BAA and its creditors and underlines the need for the regulator to ensure airport operators have the necessary resources to operate and invest in their airports".
In place of the special administration regime comes a package of proposals, including a new minimum creditworthiness requirement for operators.
The government has plans to provide the Civil Aviation Authority (CAA) with the responsibility for ensuring that airport operators can finance their day-to-day activities.
