The owners of Glasgow Prestwick Airport have suggested that they may have to give up the airport for nothing. The Scottish government announced that it is in negotiations to buy the unprofitable property from Infratil, its New Zealand owners. In a statement posted on its website, the company said that it did not expect any transaction to “give rise to material proceeds.”
Glasgow Prestwick Airport
Prestwick was put up for sale in March after sustaining heavy annual losses. The company has also been trying to sells its other UK airport, Manston Kent. On May 15, 2013, Infratil announced that it had written down the value of both properties to £11m.
The Scottish government hopes to be able to conclude its negotiations with the company by November 20. The company has agreed to ensure that the airport is kept open and operational during the negotiations.
Deputy First Minister Nicola Sturgeon stated recently that Prestwick Airport could be profitable if the right approach was taken. She said she believed that over time it could “go back to profit.” Ms. Sturgeon said that the government’s decision to step in to buy the airport was the “only realistic alternative to closure.”
She explained that once the transaction was completed, there were be a detailed business evaluation made. It would include levels of investment and a timescale on turning around the airport’s fortunes.
The Scottish government’s bid to buy the Prestwick airport comes only months after Cardiff Airport was sold to the Welsh government for £52m. The airport is being managed by an “arm’s length” body rather than the government, and on a “commercial basis.”
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