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Riyadh / AFP
A subsidiary of state-owned Irish airport operator daa has won the bid to operate Saudi Arabia’s first privately run terminal, official media in the kingdom and the company said.
Colm Moran, CEO of daa International, signed the deal to manage and operate Riyadh’s Terminal 5 with Sulaiman al-Hamdan, president of regulator the General Authority of Civil Aviation (GACA), the Saudi Press Agency said.
The contract came “in light of the authority’s policy aimed at privatisation of airports and their operations to raise the level of services and tasks according to competitive criteria,†it said.
Privatisation of some state-owned facilities is among the measures being taken by Saudi Arabia to cope with declining oil revenues which left the kingdom with a record $98 billion deficit last year.
The kingdom has announced plans to privatise by 2020 all 27 of the airports currently run by GACA.
daa International, whose parent daa runs Dublin and Cork airports, beat five other international airport operators for the multi-million-dollar contract at King Khaled International Airport serving the Saudi capital, the company said in a statement.
“This is daa International’s first airport management contract and our intention is to build on this win by adding further significant contracts in the months and years ahead,” Moran said in a statement.
The contract is for an initial five years. Moran added that the company has a proven ability “to generate significant revenue from non-aeronautical sources such as retail, food and beverage and car parking”.
The 106,500-square-metre Terminal 5 is nearing completion and has a capacity of up to 12 million passengers annually.
“There is strong demand for additional domestic air travel within Saudi Arabia,” daa International said.
In an initial step towards privatisation, the kingdom last July opened the upgraded Prince Mohammad bin Abdul Aziz International Airport in the holy city of Medina.
It was built by TIBAH Airports Development Co, a consortium of Turkey’s TAV Airports along with local firms Al-Rajhi and Saudi Oger. The joint venture runs the airport.
A sister company of daa International, ARI, recently won a 10-year contract to operate perfume, cosmetics and related retail services at Abu Dhabi’s new terminal from 2017, the company said.
daa plc, previously Dublin Airport Authority, is a commercial semi-state airport company in Ireland. The company owns and operates Dublin Airport and Cork Airport. Its other subsidiary include the travel retail business AerRianta International.