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Bloomberg
Vinci SA is doubling down on budget travel with the $3.7 billion purchase of a controlling stake in Gatwick Airport.
London’s second-busiest hub has more than tripled in value since it was bought by Global Infrastructure Partners for about 1.5 billion pounds ($1.9 billion) in 2009, mainly because of the surge in low-cost tourism.
The skies looked very different when the infrastructure investor swooped on the biggest single-runway airport in the UK. The global financial crisis had hit tourism, Ryanair Holdings reported its first annual loss after a failed attempt to buy Irish rival Aer Lingus, and Norwegian Air Shuttle ASA, now one of Gatwick’s main customers, was still years away from starting its long-haul routes.
Today, budget travel is booming to destinations near and far and airlines including EasyJet Plc, which has Gatwick as its biggest hub, are increasing plane orders, said Nicolas Notebaert, who heads Vinci’s concession and airports businesses.
“Traveling is a key element of the world of today and tomorrow,†Notebaert said.
Bernstein analyst Daniel Roeska said he’s not persuaded that Norwegian’s business model will hold, which is a near-term risk for Gatwick because the airline is its third-biggest customer.