Bosses silent over Newcastle Airport sale claims

NEWCASTLE Airport bosses remained tight-lipped last night amid speculation that the whole of the site could be put up for sale.

NEWCASTLE Airport bosses remained tight-lipped last night amid speculation that the whole of the site could be put up for sale.

Copenhagen Airports, which owns 49% of the airport, has put its stake on the market following a decision by its backers, Australian group Macquarie Bank, to withdraw from the sector.

Claims that the remaining 51% – which is owned by the seven local authorities in Northumberland, Durham and Tyne and Wear – has also been put up for sale were denied by council sources last night.

Newcastle Airport refused to comment on the reports and a spokeswoman for South Tyneside council, which acts as the lead authority for the local authorities, said: “We do not wish to comment on this market speculation.”

Bosses in the North East have a veto over the sale of the Copenhagen stake, and are expected to be able to confirm which body the 49% shareholding is sold to.

The airport recorded a drop in profits to £13.8m for 2009, compared with £19.4m for the previous year.

It is feared that without a new equity investor putting in cash into the business council bosses will have to sell their own stake. So far councils chiefs have refused to consider such a sale.

The sale of Copenhagen’s stake is unlikely to lead to any significant changes to the running of the airport.

From 2002 to the end of 2009, Newcastle Airport has paid out dividends totalling £91.8m, about half of which would have gone to Copenhagen. In that period, it has also paid £14.3m to Copenhagen in fees for management services.

The seven councils that own 51% of the airport have appointed accountants KPMG to advise them ahead of a December 2013 deadline to repay a £320m loan that the airport took out in 2006, it has been claimed.

The Journal revealed last month that fears are growing that the seven councils, known as LA7, may be responsible for clearing much of the current debt before the airport re-finances again.

LA7 is said to be £4.2m in the red after having to pay £22m in interest in 2009.

At the time of the 2006 deal the then executive directors, John Parkin and Lars Friis, had it written into their contracts that they received a percentage of the loan amount as a bonus.

The airport company is now suing the legal advisers who drafted the confidential contract in an attempt to claw back some of the millions paid to the two directors. Mr Parkin no longer works for the airport and Mr Friis has died.

 

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