The country of Saudi Arabia’s Public Investment Fund (PIF) is going to buy 10% of Heathrow airport from the Spanish company Ferrovial.
An additional 15% of its parent company, FGP Topco, will be sold to a private equity fund called Ardian, which is based in France.
Ferrovial, who has had a part of the company since 2006, said that the agreement was worth £2. 37bn ($3bn)
The deal still needs approval from the government, the company said.
If the deal is accepted, Ferrovial will stop investing in the company that operates UK airports. They started with 56% ownership but it went down to 25% by 2013.
Other companies and organizations that have a stake in FGP Topco are Qatar Investment Authority, Caisse de dépôt et placement du Québec, Singapore’s GIC, Australian Retirement Trust, China Investment Corporation, and Universities Superannuation Scheme.
The airport is not making much money this year because it owes a lot of money and the costs to borrow more money are going up a lot.
The Civil Aviation Authority has decided to decrease the fees that passengers pay for using airport facilities like terminals, runways, baggage systems, and security.
The cost per person at Heathrow airport will be £31. 57 in 2023, but the regulator expects it to go down to £25. 43 in 2024 and stay about the same until 2026.
The bosses at Heathrow wanted to raise the charges to over £40, but airlines said they should only be around £18. 50
Saudi Arabia’s Public Investment Fund is one of the world’s busiest government-owned investment funds. It has over $700 billion in assets because of its oil money. Recently, it has been putting money into sports like football and golf.
But the money is managed by a prince from Saudi Arabia named Mohammed bin Salman Al Saud. His government has been accused of doing many bad things to people’s rights.
The US intelligence thinks that Prince Mohammed told people to kill a journalist named Jamal Khashoggi in 2018. But the prince is protected from being punished in the US, and he has been asked to visit the UK by the Saudi Arabian embassy.