BAA has unveiled details of a £500
million equity injection into its London airports group.
The injection will consist of £200 million of
new equity from shareholders and £300 million from BAA Airports
Limited and FGP Topco Limited, the ultimate holding company of
BAA, which is jointly owned by BAA’s three controlling
shareholders. The funding will be used to pay down debt,
strengthen the group’s medium-term financial ratios and facilitate
its access to the capital markets.
The £300 million equity injection
from BAA Airports and FGP Topco is partly funded by finance raised
against FGP Topco's holding of £225 million of BAA
Funding Limited bonds.
Of the £500 miliion, £260 million has
now been injected into BAA (SP)
Ltd while the remaining £240 million is expected to be injected in
The £300 million equity injection from BAA
Airports and FGP Topco has been approved by the
relevant boards. The £200 million of new equity from shareholders
requires the formal approval of BAA’s three controlling
The injection follows October’s
announcement of the Department for Transport’s measures to
strengthen the financial resilience of major airports, which
removed key uncertainties for BAA and its creditors; the sale of
Gatwick, the net proceeds of which will be used by BAA to pay down
debt; and the encouraging improvement in recent passenger traffic
figures, particularly at Heathrow.
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