London City Airport handles 50,000 flights a year - Alamy

The former owner of Thames Water has expanded its sprawling network of UK assets by taking control of London City Airport.

Australian investment giant Macquarie is to acquire a further 50pc stake in the capital’s business travel hub, just four months after acquiring an initial 25pc.

While the value of the London City deal was not disclosed, it is believed to be worth billions of pounds and comes after Macquarie announced plans last year to invest £20bn in the UK.

Macquarie is best known in Britain for its troubled ownership of Thames Water between 2006 and 2017.

Over this period, Macquarie extracted £2.7bn in dividends while increasing the company’s debts from £2.3bn to £10bn.

This has prompted many critics to blame it for Thames Water’s current woes, as it battles to avoid nationalisation.

Yet this has not prevented Macquarie from buying up other vital UK infrastructure, including Southern Water and Britain’s gas network.

It took an initial stake in the hub in June via a deal with Ontario Teachers’ Pension Plan, a Canadian pension fund, which also gave it holdings in Bristol and Birmingham airports.

Macquarie is raising its stake in London City by buying out two other Canadian pension funds, Alberta Investment Management Corporation and Omers.

The other 25pc remains in the hands of Wren House, an arm of the Kuwaiti sovereign wealth fund and part of the consortium that bought the hub for £2bn in 2016.

The purchase comes after the Government last year approved London City’s bid to lift a capacity cap to nine million passengers from 6.5 million in one of its first acts after the election.

The airport, which employs 2,000 people, handles 50,000 flights a year to more than 30 destinations across the UK and Europe.

The customer tally rose 5pc last year to 3.6 million, lifting sales to £115bn and boosting profits by almost 80pc to £11.7m, according to filings on Companies House.

While travel from London City remains below the pre-Covid peak, the Civil Aviation Authority is considering an application to allow 180-seat Airbus A320neo jets to operate there.

This would be a significant upgrade on the current limits that prevent anything larger than the 135-seat A220.

The plan has stoked anger among some Londoners since it would overturn rules requiring planes to fly higher than normal before landing in order to reduce noise along the flightpath.

Sara Sulaiman, Macquarie’s managing director for Europe, said the bigger planes would expand the range of destinations within range of London City.

She said: “Our additional investment in London City Airport underscores our commitment to the UK’s aviation sector. Britain’s airports are a key driver of economic growth and demand for air travel continues to increase year-on-year.”

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As well as City Airport and Southern Water, Macquarie also has investments in UK housing, high-speed broadband, offshore wind and solar energy.

Last year, it also agreed to buy the 20pc of National Gas that it did not already own for £700m, handing it full control of a piece of critical national infrastructure.

At the same time, it agreed to sell AGS, which operates Aberdeen, Glasgow and Southampton airports, to AviAlliance of Germany for £1.53bn after a decade of ownership.

Alex Chapman, senior economist at the New Economics Foundation, said London City was targeted by Macquarie because it requires relatively little in the way of infrastructure spending.

He said: “In return for a fairly small investment from Macquarie they can just sit back and watch the landing fees and the duty-free roll in.”

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