Saudi Arabia PIF: Sovereign wealth fund behind Newcastle United announce latest UK investment

Ferrovial has been the airport’s largest shareholder since 2006 and said it will gain almost £2.4 billion from the holding.

It comes after reports last year that the investor had sought to offload its stake following the sharp recovery in traveller numbers.

Last month, seven million passengers travelled through the west London airport, up 19 per cent on the same month last year.

The completion of the stake sale is subject to regulatory approval.

The Saudi PIF would become the latest sovereign wealth fund to own a share in the airport, joining the Qatar Investment Authority, which is already a stakeholder in Heathrow parent company FGP Topco.

The PIF, which has invested in other transport sites, technology firms and sports teams such as Newcastle United, has more than 700 billion US dollars in assets.

It is controlled by Saudi Arabia’s Prince Mohammed bin Salman Al Saud, whose government has been subject to accusations over human rights violations.

Luke Bugeja, chief executive of Ferrovial Airports, said: “Over the last 17 years, we have been contributing to Heathrow’s transformation, together with our fellow shareholders, achieving some excellent milestones throughout our long-term role as investor.

“These include overseeing an investment of £12 billion, expanding its capacity with the construction of Terminal 2, and improving its operational performance.

“We are very pleased to have made Heathrow one of the world’s most connected airports and the busiest airport in Europe.”

Ferrovial said it “remains fully committed to advancing its airport business and investing in the sector”.

The firm holds a 50 per cent share in Aberdeen, Glasgow and Southampton airports in the United Kingdom, a 60 per cent stake in Dalaman Airport in Turkey and 49 per cent in JFK Airport New Terminal One in New York.

News of the sale of the Heathrow stake comes as Moody’s Investors Service released a new report which maintained a “stable outlook” on the European airports sector.

It said passenger traffic continues to increase, although the rate of growth is expected to be slow during 2024 and traffic performance to remain uneven across airports.

Corrado Trippa, Vice President, Senior Analyst at Moody’s, said: “Rising aeronautical charges and commercial activities will support revenue growth, while pressure on operating costs remains above historical levels.

"Overall, we expect the aggregate profitability of our rated airports to remain broadly stable during 2024.

"Capital expenditure will rise, following a period of reduced spending, limiting deleveraging prospects.”