Airport offer

Former chair Black emerges as Prestwick bidder

Forsyth Black
Forsyth Black is working with a Canadian fund

A former chairman of Prestwick Airport has teamed up with a Canadian private equity fund to pull together a bid to buy it from the Scottish Government.

Forsyth Black, who resigned in February without explanation, is working on a deal with Onex Corporation, the fund behind WestJet, Canada’s second-biggest airline.

Ministers admitted in December that a potential buyer had stepped forward, but declined to identify the party involved. The government has now confirmed that Mr Black is linked to an offer.

The former chief executive of multinational airport refuelling company Menzies told officials that remaining in his role was a conflict of interest, according to weekend report that suggested government officials are taking seriously this latest attempt to get the airport back into private hands.

The Ayrshire airport, 34 miles south of Glasgow and famous for being the only place where Elvis Presley set foot on British soil after two years of military services in Germany, was nationalised in 2013 by the SNP government which paid just £1 for it.

Since then it has become known as a base for Turnberry golf course owner Donald Trump’s private planes and for refuelling US military aircraft. Filings reveal the US Defense Department has spent the equivalent of about £50,000 a day on fuel at Prestwick.

It has a thriving cargo business and passenger traffic more than trebled to 459,000 last year. But Ryanair is its only passenger customer and although Prestwick has made an operating profit for the past four years and revenue is up from £35m to £58m, there is still a large loan provided by the government.

Cargo at Prestwick
Prestwick has a thriving cargo business

It was disclosed in December that the taxpayer has poured £52m of loans into the facility since it was taken into state ownership in order to save 300 directly-employed staff and up to 1,400 in the supply chain.

At a meeting of the Scottish Parliament’s Economy and Fair Work Committee that month chief executive Ian Forgie was asked if there were any credible bids on the table for the airport.

He said: “We’re currently looking at one expression of interest that is going through that early process of diligence and we’ll give more details in due course.” Neil Gray, the Economy Secretary at the time, said there was a non-disclosure agreement in place.

Those close to Mr Black say his offer includes a commitment to retain jobs for the first three years and to keep running Prestwick as an airport for at least five years.

A source told Daily Business that this may relate to potential claims by those who have been denied the option to build on the 880 acres of land that includes a second runway.

While it has a long runway that is fog-free and can handle large aircraft, doubts have been cast on suggestions that it could be established as a long-haul hub.

The source told Daily Business that the airport should terminate passenger services which are a drain on its resources.

“They need to maintain all the infrastructure around it, check-in and baggage handling, security, for a small number of passengers. It’s just adding to the costs,” said the source who added that it is a poor passenger experience as there are so few facilities.

He said the whole facility should be given over to maintenance and aerospace development work “which is what it is good at, and known for”.

The Scottish government issued a statement confirming Mr Black’s involvement. It said: “As one of the most recent expressions of interest is linked to Forsyth Black, the then chairman of the board of the airport, it was mutually agreed that Mr Black should step back from the board to ensure an independent and fair assessment can be made. The Scottish Parliament will be updated when appropriate.”

Leave a Reply

Your email address will not be published. Required fields are marked as *

This site uses Akismet to reduce spam. Learn how your comment data is processed.