Midway officially sold

DALLAS — Chicago’s Midway Airport is the first major airport in the United States to be privatized. Yesterday it was announced that it had been sold to “a consortium consisting of Citi Infrastructure Investors, YVR Airport Services (a joint venture between Vancouver airport and Citi Infrastructure Investors) and John Hancock Life Insurance,” according to the Financial Times. It will be operated by the Vancouver airport owner. The big surprise, according to Southwest Airlines folks I talked to last night, was how competitive the bidding was in a tight economy. The final price was $2.5 billion, and among the bidders were consortiums including the biggest names in airport infrastructure: Germany’s Hochtief, GECAS, Aeroports de Paris, and Australia’s Macquarie Group. (Southwest folks are very pleased with the opportunity to work with a private owner, and as the largest airline at Midway, they’ve been consulted and involved in the process all along.)

The great thing about this purchase is that it gives us an opportunity to test the performance of a privatized airport in the U.S. market, which is almost entirely under public ownership. It is part of the FAA’s Airport Privatization Pilot Program, and the Midway experience may clear the way for more infrastructure privatization in the future.

Chicago Midway in $2.5bn privatisation deal [FT]