Gloucestershire Airport sale collapses
After months of uncertainty the attempt by the local authority owners of Gloucestershire Airport to sell the 375-acre site and business parks has fallen apart.
Dear readers,
Welcome to a Thursday single story from The Raikes Journal.
Whether this takes place of Friday’s whole edition yet remains to be seen, but this story appeared in our sights and we diverted energy straight to it.
Anyone who follows the saga of Gloucestershire Airport will possibly only sigh at the latest development. You may not feel it’s important at all. But if you live in Gloucester or Cheltenham, this deal could have won you back at least £12 million the airport owes you as a taxpayer.
Some argue the sale of the site could net considerably more - much disputed by the local authorities that own the airport - a sum in excess of £300 million, if sold for houses. That would wipe debts out everywhere and give transformative money to the county.
And then there are the businesses on the airport site, of which there are many. The airport has long been a political football, its story often mired in local politics. Businesses were relatively used to that. But this chapter has been particularly difficult.
For a county also trying to build confidence around another local authority-led project, the ‘once in a lifetime’ Golden Valley Development, it also doesn’t make for great reading.
What next?
What next indeed.
Best regards,
Andrew Merrell (editor).
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Gloucestershire Airport sale collapses
After months of uncertainty attempts by the local authority owners of Gloucestershire Airport to sell the 375-acre site and business parks has fallen apart.
By Andrew Merrell.
It was only Friday last week when The Raikes Journal spoke to Horizon Aero Group about its purchase of Gloucestershire Airport after the deadline seemed to be slipping again, and it confirmed “talks were continuing”.
Today we’ve learned that businesses which operate from the airport, many of which have halted investment plans while uncertainty reigned over the site’s future, have been told that deal is off.
Much championed by the airport’s owners, Gloucester City Council and Cheltenham Borough Council, the Anglo-Indian partnership had apparently offered north of £25 million for the Staverton site.
All along the local authorities had sought to reassure everyone via a stream of social media releases that any new owner would be forced to commit to keeping the site operational as an airport, and not sell it for houses.
Speculation from some quarters had suggested the land would be worth more than £300 million to £400m if sold for housing development, and there was even talk that this would be a more sensible move to clear debts at the airport and both councils.
But the council remained adamant this would not happen and Horizon Aero Group was the best prospect, having offered significantly more than any other party that had come forward.
Businesses like RGV Aviation, a family-run aerospace business which has operated from Gloucestershire Airport for more than half a century, had said all along that the councils had done little to reassure him or other businesses that Horizon Aero Group was a suitable owner.
A letter from the councils to Stuart Vincent, managing director of RGV Aviation, said the local authority’s corporate advisers - Savills UK, and Cheltenham-based BPE Solicitors LLP and Hazlewoods accountants - had “undertaken considerable work to assess the suitability of the bidders for the airport”. That was when the ‘agreement’ was first announced.
But he remained unconvinced, as did others on the site.
So much so that Vincent put a significant investment in his business on ice for the foreseeable. RGV Aviation is a leading aircraft maintenance, repairs and parts, avionics business for marques including Cessna, Piper, TBM and Cirrus.
This was his reaction after today’s news.
“We still don’t have any certainty. All along, ever since the name surfaced in October, we have expected this buyer not to be suitable.
“It is not very good for the airport. From the local authorities’ point of view, they have to start the process again. The councils still wants to sell the airport. However, there are still parties that wanted to buy it and remain interested.
“Whether the councils will realise the amount of money Horizon was talking about is another thing. Probably not. I think the best the councils can expect to get it to be able to cover their debt the airport owes the councils.”
Raikes understands the debt – money owed to the taxpayers of Cheltenham and Gloucester - currently stands at £12m, potentially far higher.
“I think there are at least three other interested parties I know of. These are people who know about aviation and have an aviation background. It is just a case of whether the figure they would offer would be acceptable to the councils,” said Vincent.
“If they did, obviously they would be a lot better. But it all takes us back to where we were at the start of last year.
“And, back then, we were assured that any new owners would have an airport background and be committed to it remaining an airport. That went out of the window very quickly when a higher offer was made.
“I think the council just saw pound signs. The airport was for sale with Savilles and it was on commission and it simply presented the highest bidder and the councils went for that.
“We have more uncertainty now - at the very least at least six to 12 weeks - while they consider another bidder. If they decide to go ahead, that is.”
Darren Lewington, founder of Aerotiques and one-time boss of Gloucestershire Airport in happier times, said: “it is not surprising that the deal with Horizon has fallen through. Many of the tenants and operators at the Airport expressed concern from the outset at the paucity of Horizon’s bid when it became public.
“The airport is still the UK’s busiest general aviation airport and the shareholders need to act quickly to secure its future and reassure the clients.”
Here’s the joint statement from local authorities….
Cheltenham Borough Council and Gloucester City Council as joint shareholders have today confirmed that they have been unable to reach an agreement with Horizon Aero Group on the sale of Gloucestershire Airport.
The councils are disappointed that they were unable to accept the terms from Horizon Aero Group, which had moved significantly away from the original bid prospectus, and recognise that this news will be disappointing for many people who had hoped for immediate certainty about the future of the site
The councils will continue to maintain close contact with operators and tenants to provide reassurance and keep them updated as work continues on alternative options.
During an extended period of negotiations and due diligence, as joint owners, both councils worked extensively to support the proposed sale, with the clear objective of securing the best possible long term outcome for residents, local businesses and the wider regional economy.
Councillor Rowena Hay, leader at Cheltenham Borough Council said: ‘’It is our duty to deliver best value on the sale of the airport and of course after a long period of due diligence, we are disappointed that we couldn’t reach an agreement to deliver that and proceed with the sale to Horizon Aero Group.
‘’We fully appreciate the concern this will cause, particularly for those employed at the airport who will have worked hard to support the sale process. As we move forward, we are committed to continued engagement with staff, operators, tenants and key stakeholders to discuss the future and reach a positive outcome for Gloucestershire Airport.’’
The leader of Gloucester City Council, Councillor Jeremy Hilton, said: “This news is clearly disappointing as the combination of a clear commitment to flying by Horizon, and the continued operation of aviation based businesses, would have provided a strong future for the site. I fully recognise that people hold different views about the potential uses of the site, but our responsibility is to take a measured, evidence‑based approach that leads to the right outcome for the long term.”
Horizon Aero Group was approached for comment. No one was available.
More here: Airport deal could sell Gloucestershire short, warns business
More here: Has the sale of Gloucestershire Airport hit political turbulence?
More here: Speculation over the real future of Gloucestershire Airport is sky high
More here: Gloucestershire Airport flies into controversy – again!