The investment arm of the Chinese government has purchased a 10 per cent stake in the owner of Heathrow for £450 million.
China Investment Corporation (CIC), which invests the country’s reserves of foreign cash, confirmed it had taken the shareholding in Heathrow’s owner, which used to be known as BAA, but did not give any further details.
Heathrow Airport Holdings also includes Southampton, Glasgow and Aberdeen airports. It is in the process of selling Stansted after losing a series of appeals against a Competition Commission decision that the Essex airport must be sold.
It is the second time in the last three months that a major sovereign wealth fund has invested in Heathrow Airport Holdings – Qatar Holding agreed to pay £900 million for a 20 per cent stake in August. Singapore’s wealth fund also owns 3.75 per cent of the company.
China Investment Corporation is a state-owned company set up in 2007 to look at ways to invest $200 billion of the country’s foreign exchange reserves.
The deal means that Heathrow Airport Holdings’ biggest shareholder, Spanish infrastructure group Ferrovial reduces its stake from 49.99 per cent to 44.27 per cent. Ferrovial was part of the consortium which purchased BAA in 2006.
Inigo Meiras, CEO of Ferrovial, said the CIC deal was part of its “investment diversification strategy”.
“Following this deal, we reiterate our role in Heathrow Airport Holdings. as the industrial partner,” said Meiras.
“As previously stated, we will continue to work with the new shareholders and with existing shareholders to ensure that Heathrow Airport Holdings retains its position as one of the best infrastructure assets in the world."
CIC said it was committed to “long-term investment” based on “established investment principles and values”.
“CIC usually does not take a controlling role – or seek to influence operations – in the companies in which it invests,” it said in a statement on its website.