Saudi PIF Buys Ownership of London Heathrow Airport

Saudi Arabia’s Public Investment Fund (PIF) is going to buy a 10 per cent ownership stake in London Heathrow Airport. An investment fund controlled by Saudi Crown Prince Mohammed bin Salman is buying a stake in Heathrow from Spanish infrastructure giant Ferrovial.

Ferrovial has owned a stake in London Heathrow Airport since 2006, Arab News reported on Wednesday. Currently, the 10 per cent stake owned by them is worth $3 billion. This is what is being sold to the Saudi PIF. French-based private equity fund Ardian is buying another 15 per cent stake owned by Ferrovial’s parent company, FGP Topco.

According to Ferrovial, the manner in which the financial transaction will be done is being reviewed by the PIF regulatory authority as per the rules. If approved, the deal will end Ferrovial’s investment in operating Heathrow Airport. Initially, Ferrovial, along with FGP Topco, owned 56 per cent of the shares, but the company sold some of its shares in 2013. This brings their ownership down to 25 per cent. Other stakeholders in FGP Topco include the Qatar Investment Authority, GIC of Singapore, the Australian Retirement Trust, the China Investment Corporation, and the University Superannuation Scheme.

London’s Heathrow International Airport has suffered losses in recent years. Since the coronavirus pandemic situation, the airport has been running on net loss due to reduced passenger numbers and increased tax burden. In the meantime, Saudi PIF is going to buy ownership shares. Saudi Crown Prince Mohammed bin Salman controls the investment fund. PIF is essentially one of the world’s independent investment funds that owns oil assets, and that is why PIF owns more than $700 billion in assets. The investment fund has recently invested in sports such as football and golf. The famous English Premier League club Newcastle United is also owned by PIF.

For more travel-related updates and news, follow NCL Travel.