UK abandons plans for NATS share sell-off

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Published: July 12, 2012

The UK government is abandoning plans to sell off its 49% shareholding the UK’s part-privatized air navigation services provider NATS.

Secretary of State for Transport Justine Greening said in a written statement that the responses to a call for evidence run last year “highlighted the strategic importance of NATS to the UK and the far reaching implications of a sale at this time. These include the continued development of the Single European Sky agenda and the ongoing work on the Single European Sky Air Traffic Management Research Programme (SESAR).”

The call for evidence aimed to determine whether the protections available through legislation and the NATS license, that are independent of the government’s shareholding, were sufficient to ensure the UK’s overall aviation policy objectives on economic growth, environment, safety and security would not be compromised by such a change of ownership.

Greening said she had also taken into account the “potential value that could be realized through a sale of the shares alongside the benefits from receiving dividends from a retained shareholding.”

She said: “After considering these factors, I have concluded that it is in the best interests of the British taxpayer, the traveling public and the company itself to retain the government’s shares in NATS at this time.”

In addition to the government share, NATS is owned 42% by the seven-member Airline Group, which includes British Airways and Virgin Atlantic; 4% by Spain’s Ferrovial, which owns the UK airport operator BAA; and 5% by staff. 

Prospect, the union that represents more than 3,000 air traffic controllers, engineers and specialists, welcomed the government decision.

Prospect National Secretary Garry Graham said the government had “recognized that NATS is a crucial part of the UK aviation infrastructure and of key strategic importance.”

He said: “The government has clearly listened to the representations made by stakeholders for safety and service delivery to remain paramount, and for the UK to continue to have an authoritative voice in Europe, particularly during the development of the Single European Sky initiative.”

However, Graham warned that, while the government decision provides a welcome degree of stability, “all eyes will now turn to the Airline Group—and their intentions.”

“They purchased their stake because they had a vested and visceral interest in safety and service delivery,” he said. “We are concerned that their position is now focused on short-term commercial gain.”

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