Qatar buying into German airport operator

01 August 2016

Fraport operates Russia’s St. Petersburg airport

The weakness of the Russian currency has prompted Germany’s Fraport to sell its stake in the operator of the St Petersburg airport in Russia to the Qatar Investment Authority (QIA).

Fraport is expected to generate some €30-40m ($34-45m) from the sale, according to a report by London-based Reuters.

Income from the sale is seen to offset Fraport’s weakening revenues, which are falling not just due to the weakness in the Russian rouble but from declining revenues at airport hubs in its home base, Frankurt, and at Turkey’s Antalya airport.

It is understood that the sale will boost its prospects of meeting its 2016 earnings forecast.

The recent coup attempt in Turkey and attacks in Europe particularly in France and Germany have adversely affected travel demand. This has been confirmed by a number of airlines including EasyJet (UK), Lufthansa (Germany), Air France-KLM and IAG.

Fraport earlier reported its passenger numbers at Frankfurt dropped 1 percent in the first six months of 2016, while it was down 30 percent at its Turkish Antalya airport following recent suicide bombings in the country. French airport operator Groupe ADP also reported lower revenues in the first six months.

Fraport was awarded a $111.3m contract in 2008 by Saudi Arabia’s General Authority of Civil Aviation (Gaca) for the management of Jeddah’s King Abdulaziz International airport (KAIA) and Riyadh’s King Khaled International Airport (KKIA). The contract expired in 2014.

A contract is under tender for the operation and maintenance of the KAIA, Saudi Arabia’s busiest airport. It has not been confirmed if Fraport is bidding for the contract.

 

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