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Last Updated: Thursday, 31 August 2006, 07:14 GMT 08:14 UK
BAA rejects demands for break-up
Plane arriving at an airport in Madrid, owned by Ferrovial
BAA was bought by Spanish building group Ferrovial this year
Airport operator BAA has rejected calls for the break-up of its UK airports, saying a "more fragmented structure" would undermine future investment.

BAA runs seven UK airports and has been accused of market domination.

Both British Airways and Ryanair have called on competition authorities to consider breaking up the ownership of BAA's three main London airports.

But BAA chief executive Stephen Nelson told the BBC that a break-up "was not a recipe for long-term investment".

'National importance'

Earlier this year, BAA was bought by Spanish building group Ferrovial in a deal which valued the UK firm at 10.3bn ($19.5bn; 15.2bn euros).

In June, the Office of Fair Trading (OFT) announced an investigation into airport ownership in the UK.

Heathrow - 67.7 million a year
Gatwick - 32 million
Stansted - 22 million
Southampton - 1.5 million
Glasgow - 8.7 million
Edinburgh - 8 million
Aberdeen - 2.7 million
Source: BAA

BA has urged the Competition Commission to look at separate ownership of Heathrow and Stansted airports. Budget carrier Ryanair has also appealed for BAA to be dismantled.

But Mr Nelson told BBC Radio 4's Today programme: "I believe we have a very strong record of running the airports going into this review.

"It is a debate of national importance, about capacity over 25 years. If the OFT does what the airlines are asking there will be less investment in airports, and gridlock."

'Normal schedules'

BAA is set to expand, with the completion of a new terminal at Heathrow scheduled for 2008, as well as a new runway at Stansted by 2013.

BA, along with other airlines, criticised BAA for its handling of the extra security measures introduced after an alleged bomb plot was uncovered, which forced airlines to cancel hundreds of flights from Heathrow.

At the time, BA said BAA's management had "no adequate plan" to deal with the emergency.

But Mr Nelson said after a "very difficult" time following the security alert BAA airports had "pretty well returned to normal schedules".

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