A consortium backed by the Irish Aviation Authority was chosen yesterday to operate Britain's air traffic control services.
The Airline Group - controlled by eight airlines - emerged as the British government's favoured bidder for a 46 per cent stake in its National Air Traffic Service operation.
The Irish Aviation Authority, chaired by Mr Donal Geaney of Elan Corporation, provided project management for the bid and advised its partners on air traffic management, strategy and capital investment requirements.
The authority has no plans at present to take an equity stake in the airline group, whose bid is worth £800 million sterling (€1,282 million). But while its chief executive Mr Brian McDonnell said that purchasing such a stake had not been proposed when the airline group approached it last year, yesterday's development meant the final terms of the authority's involvement would now be discussed.
The authority had yet to decide whether it would seek equity, Mr McDonnell said. All strategic options would be assessed. He would not reveal the revenues the authority planned to generate at the National Air Traffic Service. Telecoms group BT is technology partner to the group, whose members include British Airways, British Midland, Virgin Atlantic and EasyJet.
The group plans to invest £1 billion in the British service, which it will operate on a not-for-profit basis. It was chosen above a rival bid led by the facilities management group Serco.
The British government will retain a 49 per cent golden share in the service and its staff will take 5 per cent of the operation. The part privatisation will go ahead on June 1st.
The government hopes the change will prove a catalyst for the consolidation of European air traffic management services.
With skies crowded and air traffic growing by about 5 per cent each year, the European Commission is keen to develop trans-national air traffic control services with inter-operable flight data processing systems.
The separation of safety regulation from the provision of air traffic services was also planned as part of the Single European Sky project.
"It makes sense in the whole area of capital investment for common standards to be agreed," Mr McDonnell said. Other potential synergies could be developed by using such standards when designing route traffic.
The group was already working with the Irish Aviation Authority's counterparts in Germany, the Netherlands, Belgium and Iceland to develop international links for the British service's business.
Opposition to the part-privatisation by trade unions representing air traffic controllers delayed the passage of the Transport Bill. It also prompted suggestions that the government would not be able complete the process until after the British general election, planned for May.
The choice of the Airline Group lifts the immediate threat of industrial action by controllers. They opposed the Serco bid and were likely to have been balloted for strike action if the group was successful.
