Prestwick Airport is being put up for sale by the Scottish government.

The airport was taken into public ownership six years ago after it was threatened with closure following heavy losses.

Transport Scotland said an advert would be placed in the Official Journal of the European Union, inviting expressions of interest.

Ministers have regarded Prestwick Airport as a strategic economic asset, particularly for Ayrshire.

It passed into state hands after being bought by the Scottish government for £1 in late 2013.

The Scottish government said then that the deal would help protect the airport and safeguard thousands of direct and indirect jobs.

Prestwick has been looking to turn around it fortunes, including applying to carry out horizontal space launches from its 2,986-metre concrete case runway.

Transport Secretary Michael Matheson said: "Since the Scottish government bought Glasgow Prestwick Airport in 2013, we have been clear that it is our intention to return the business to the private sector when the time is right.

"The senior management team at the airport has continued to engage with potential buyers and investors to discuss proposals for developing the business under new ownership.

"Good progress continues to be made by the airport to increase revenue, deliver operating efficiencies and pursue exciting opportunities for the future, including Spaceport."

Mr Matheson added that any expressions of interest would be "considered carefully" before any decision was taken to divest the government's shareholding in the airport or any part of the business.

In January, it emerged that the debt owed by Prestwick Airport to the Scottish government had risen from £30m to £38.4m.

That was while revenue rose through a doubling of funds from refuelling aircraft at the publicly-owned facility.

Accounts lodged with Companies House showed the holding company made a loss of £7.6m in the year to March 2018, down from £8.6m the previous year.

Breathe wrote:

I'm not an expert in the field, perhaps it could do well just as a small cargo airport with other associated facilities like refuelling U.S military planes and Ryanair maintenance.

Breathe wrote:

I wonder where all the jobs at Spirit Aerosystems, Ryanair, BAE Systems Regional Aircraft etc. would go if the airport closed. GLA, EDI, downsouth or abroad???

Breathe wrote:

I wonder where all the jobs at Spirit Aerosystems, Ryanair, BAE Systems Regional Aircraft etc. would go if the airport closed. GLA, EDI, downsouth or abroad???

sassiciai wrote:

PIK was a very useful airport in the early days of TATL flights (and probably before for military flights and delivery flights). When in winter time much of the UK was covered in impenetrable fog that closed many/all destination airports, PIK had an unrivaled reputation for being fog-free (next to the coast with its prevailing on-shore wind), and was often used as a diversion airport.

Fog in Glasgow and Edinburgh has not disappeared as an occasional phenomenon, so closing PIK would eliminate that fall-back entirely

Someone above indicated that the desire is to close the PIK Terminal, as that is what racks up the losses. So close it, even demolish it!

It might then have a chance as a non-pax (ex emergency weather diversions) to make it as a refueling point for delivery for lighter aircraft, for cargo, for military, and for the Royal Navy S&R helicopters. I wonder if it could be developed as a logistics hub!

PRESTWICK Airport could be sold to a private bidder within four months, it has emerged.

Newly-issued official documents include an “indicative” sale completion date of October 4.

However they omit the £40m debt-pile burdening the loss-making operation.

The Scottish Government, which bought the airport for £1 in 2013to save it from closure, announced last week it was putting it up for sale in a bid to return it to the private sector.

It said an advert in the EU journal for public tenders would invite expressions of interest in order to “test the market”.

The move put a question mark over the £39.9m in Government loans keeping Prestwick afloat, with opposition parties questioning what if anything would ever be repaid.

The official documents for would-be bidders have now been released by TS Prestwick Holdco Ltd, the government owned company behind the airport.

The documents say the firm is “exploring the sale of 100% of its shareholding in Prestwick Aviation Holdings Ltd”, which owns Glasgow Prestwick Airport (GPA), and that the preffered bidder will be whoever submits “the most economically advantageous offer”.

They describe the airport as offering “a wide range of aviation services including freight, passenger military, specialist executive handling as well as general aviation.

“GPA is the only airport in Scotland to have its own railway station and railway link straight to the terminal. GPA has two runways serviced via six aprons.

“The terminal building was originally constructed for four million passengers and currently has capacity for 18 check in desks, 10 gates and 12 stands.

“GPA is located on a significant land bank of 356 hectares – 65 per cent of which is utilised for aviation activities.”

The documents say up to three bidders are expected, with companies told to lodge eligibility questionnaires by July 15.

An “indicative outline” of the next steps, which may change, says shortlisting of bidders could then be completed by July 26, due diligence work and the selection of a preferred bidder by September 6, and “transaction completion” by October 4.

The only clue in the documents to GPA’s grim financial position is a single reference to the Scottish Government being the preferred creditor, although the loan size is not given.

The documents say offers will be evaluated on “the price offered for the shareholding in Prestwick Aviation Holdings Ltd on a debt free cash free basis (to be applied in repayment of the Scottish Government loan first)”.

Offers will also be evaluated on “the level of transaction certainty and other terms of the Offer, covering aspects such as time period to completion, conditions attached to the Offer, terms of the sale and purchase agreement, and the deliverability of the proposals.”

Besides the £40m owed to the taxpayers, Prestwick also has around £8m in other liabilities, around the same as its assets.

According to its latest accounts, TS Prestwick Holdco Ltd made a £7.6m loss on a turnover of around £18.2m in 2017/18.

Ryanair is its last main commercial carrier, and its is increasingly reliant on cargo flights and refuelling services for business.

The SNP Government bought GPA, which supports 300 jobs directly and 1500 indirectly, from New Zealand-based Infratil after it tried in vain for a year to find a private bidder.

At the time, the airport was losing around £2m a year.

Then deputy First Minister Nicola Sturgeon said the government would produce a plan for “turning Prestwick around and making it a viable enterprise”, but it has kept making losses.

An aviation company chief who offered to buy debt-ridden Prestwick Airport fears it could be closed or scaled down if a sale cannot be secured.

Orbital Access chief executive Stuart McIntyre said nearly £40 million lent by ministers to keep the South Ayrshire site going was likely to have caused the sale to be delayed.

His comments follow transport secretary Michael Matheson admitting to MSPs that a deal could fall through, as The Scotsman revealed yesterday.

Mr Matheson wrote: “While efforts are currently focused on returning the airport to the private sector, which has been our intention since purchasing the airport in 2013, should this not be achievable for any reason we will consider options for taking the airport forward in the future.”

The airport was put up for sale in June, with official documents stating that a preferred bidder was expected to be chosen in the first week of September and the sale completed by about 4 October.

Mr McIntyre said his bid, which was made with investors independently of Orbital Access last year, had foundered because of the Scottish Government’s unwillingness to negotiate over the sale including responsibility for the £40m debt.

He told The Scotsman: “Our submission was rejected over the pivotal matter of the treatment of the Scottish Government debt.

“It was most certainly the stumbling block, and I would not be surprised if the debt question has become the problem in the current sale process.

“It certainly appeared to be a red line - the Scottish Government was unwilling to enter any substantive negotiations over it.

“The debt has been used to cover operating losses, not for infrastructure improvements, so it has had no economic value.

“Any acquirer of the airport will need to make significant infrastructure investment to put it on a level with competitors, such as to hangars and freight facilities.

“We proposed £100 million, plus a further £200 million from third parties.

“We decided not to renew our bid. Having been through it before, there was no point in spending on further bid costs.

“The fear of strategic Prestwick-based aerospace businesses such as ours is that the Scottish Government, if a sale isn’t achieved, will consider closure or a significant scaling back of airport operations with the associated devastating impact on the Ayrshire aerospace economy.”

A spokesman for the Scottish Government’s Transport Scotland agency said: “To protect the integrity of the process, we will not be making any further comment and will update Parliament at the appropriate time.”

Ministers bought the airport for a token £1 to avert its closure and the loss of hundreds of jobs.

Mr Matheson told MSPs last week that detailed scrutiny of bids by the airport’s management was taking longer than expected.

It is unclear who has lodged bids for the site, but both Glasgow and Edinburgh airports - Prestwick’s rivals - have denied they have made offers.

Cunard wrote:

Donald Trump as your fully aware is not permitted to involve his business activities along with being President of the United States of America!

The NHS is not going to be sold to Donald Trump, whatever is stated by the media it's just not going to happen.

How and why would Donald Trump run the NHS from an airport?

Let's get these ridiculous suggestions squashed before they are taken seriously!

PIK has had it's day as a commercial airport, that is a true fact, it's not fake news.

PIK has no real future regardless of the Spaceport intentions.

Cunard wrote:

Donald Trump as your fully aware is not permitted to involve his business activities along with being President of the United States of America!

gravytrain wrote:

Seemingly AGS, the owner of Glasgow Airport (& Aberdeen and Southampton) are in line to buy Prestwick.

Politicians today welcomed news that Glasgow Airport's owner is in line to buy its struggling rival Prestwick.

AGS Airports, which also owns Aberdeen and Southampton, is understood to be the preferred bidder for the South Ayrshire airport which calls itself Glasgow Prestwick, as The Scotsman revealed yesterday.

Transport secretary Michael Matheson told MSPs he was unable to disclose the bidder "to protect the integrity of the process".

Sources said Scottish Government-owned Prestwick hopes the sale process will be completed by the end of January - three months later than scheduled.

It is believed two other groups were invited by ministers to bid for the airport among those who had expressed interest - French firm Vinci and a foreign consortium.

A comment from Vinci has been requested.

Scottish Conservatives transport spokesman Jamie Greene said: "I can see the logic in expanding through acquisition of a neighbouring site, and that particular group has an excellent track record of turning around airports.

“The value in this businesses is the uniqueness of its aviation assets, runway and location.

"Whatever its future, I’m hopeful these continue to be its main purpose and any new owner cannot simply mothball the site to eliminate competition."

But Mr Greene added: “It’s disappointing such an important announcement was snuck out the door before Parliament closed for the holidays.

He also said: “It’s vital the huge sums of money loaned to the business are repaid, regardless of who the new owner is."

An aviation source said: "This would be a great outcome for both Prestwick and Glasgow airports.

"Glasgow could focus on its core business of passengers and offer other operators an auditable alternative for freight, fuel stops and possibly low-yield passenger flights."

South Scotland MSP and Scottish Labour transport spokesman Colin Smyth said: “ Buying Prestwick airport would be an obvious choice for the owners of Glasgow airport and would potentially offer them a solution to their desire for a second Glasgow airport runway.

"It’s just a shame the Scottish Government have vetoed proposals for a direct rail link to Glasgow airport.

"Such a link would mean you could travel between terminals at Prestwick and Glasgow in less than an hour, which would open up a whole host of opportunities.

"If any sale of Prestwick to the owners of Glasgow is successful, then I hope the Scottish Government would rethink their opposition to a direct rail link.

"However, the Government must ensure any sale be to a buyer who has clear plans to maintain and grow jobs at Prestwick and pays back the more than £40m of taxpayers money loaned to the airport.”

Prestwick was officially put up for sale in June, six years after the Scottish Government bought it from New Zealand owners Infratil for a token £1 to avert its threatened closure with the loss of hundreds of jobs.

KingB123 wrote:

I think they should really either consolidate flights at either GLA or at Prestwick and close one airport down. Prestwick has the railway station and GLA has the commercial passenger infrastructure that prestwick has but lacks. Depends whatever is the best and easy solution really.

Breathe wrote:

KingB123 wrote:

I think they should really either consolidate flights at either GLA or at Prestwick and close one airport down. Prestwick has the railway station and GLA has the commercial passenger infrastructure that prestwick has but lacks. Depends whatever is the best and easy solution really.

Would moving all commercial flights from GLA to PIK be feasible though? Perhaps moving freight flights from GLA to PIK might make more sense?

gravytrain wrote:

Seemingly

Prestwick Airport’s state-backed management remain confident of concluding talks with a buyer despite the impact of the coronavirus on traffic.

Talks are continuing with an undisclosed preferred bidder as the Ayrshire airport reports a £3 million underlying operating profit following a £1 million loss in the previous year.

Revenue in the year to the end of March increased by 46% year-on-year to £36m against £24.6m.

“A preferred bidder was appointed as part of the sale process. Whilst talks… are continuing, it has been necessary to extend the timeframe for these discussions.

“Due to Glasgow Prestwick Airport’s importance to Scotland’s national infrastructure, we are confident that the business can be sold in due course.

“We will continue to investigate opportunities to further develop the business under its current ownership but also with an eye to future ownership as part of a markedly different global aviation industry.”

Bhoy wrote:

The sale is back off as the unnamed preferred bidder has pulled out due to Covid.

https://www.bbc.co.uk/news/uk-scotland-54359384

chunhimlai wrote:

Trump may buy the airport for connection to the turnberry hotel

2travel2know2 wrote:

In the Real Estate market, how much is GLA (Abbotsinch) land worth right now?
Where to is Glasgow urban core growing? West, east, north or east towards EDI and Edinburgh?
Selling GLA land for real estate may pay to built-up and promote PIK but, distance-wise Glasgow travellers would then have 2 airports to chose from: EDI and its own, PIK.
Then the only way PIK would woo passengers to use the airport would be a fast, cheap rail link and make sure it has cheaper fares than EDI (plus destinations not served from EDI)..
However, given the proximity between GLA and EDI, selling GLA or part of it, leaving what's left as a LCY-style airport and GLA management investing to expand EDI with a fast rail link could make EDI know from then on as Edinburgh-Glasgow International.
IMHO, an Edinburgh-Glasgow airport would potentially really rank-up quite high among UK airports.

SNP ministers are to try to sell off Prestwick Airport again after the previous bid fell through because of coronavirus devastating the aviation industry.

Despite the pandemic continuing, the state-owned company behind the airport will try to sell its entire shareholding in “a voluntary competitive process”.

It follows the collapse of a previous year-long bid to sell Prestwick in September.

Scottish ministers paid £1 for the airport in 2013, taking it into public ownership to protect jobs and an economically important regional asset.

The Government has since loaned it more than £42m to stay afloat, with £33m written off.

It was put up for sale in June last year.

The move comes five months after a sale to an undisclosed bidder fell through, which The Scotsman reported was Glasgow Airport owner AGS Airports.

Ministers had formally put the South Ayrshire airport up for sale in 2019 after buying it for a nominal £1 to avert closure by its New Zealand owners Infratil and hundreds of job losses.

The Scottish Government declined to say how many offers it had received.

It is also not clear if the sale will include the repayment of some £40 million in Scottish Government loans.

Mr Matheson said: “Since the Scottish Government bought Glasgow Prestwick Airport (GPA) in 2013, we have been clear that it is our intention to return the business to the private sector when the time is right.

"In November, a notice was placed in the Official Journal of the European Union inviting expressions of interest.

"That attracted credible interests and since then GPA and its professional advisers have carried out a detailed evaluation of the competing bids.

"I am pleased to report significant progress has been made and I have agreed the selection of a preferred bidder.

"This allows the process to move to the next stage and potentially an early divestment of our shareholding.

“To protect the integrity of the process, we will not reveal the identity of the preferred bidder at this stage.”

Mr Matheson said last September when announcing the previous sale had fallen through: “Covid-19 has impacted on the aviation sector globally.

“We have been advised that the company selected as preferred bidder does not wish to complete the purchase of the business at this time.”

Scottish Labour transport spokesperson Colin Smyth said: “It is vital any deal to sell Prestwick Airport must include a clear commitment from the buyer to retain and grow jobs at the airport, which are vital to the economy of Ayrshire.

“Any deal should also have a clear plan showing how the taxpayer will get back the tens of millions of pounds loaned to the airport from the public purse.

“We must not allow a cut-price sale for the sake of the SNP Government washing its hands of the airport unless it gives the taxpayer value for money.”