Heathrow shareholder Ferrovial freezes investment in UK over Brexit uncertainty

SPANISH transport infrastructure giant Ferrovial has decided not to invest any further in Healthrow Airport due to Brexit.

Britain offers 'no opportunities', says chair Rafael del Pino, meaning any planned future mergers and acquisitions are now off.

“No-one knows, not even the United Kingdom, how the process and consequences of Brexit will pan out,” says Del Pino, who adds that Ferrovial's approach to business in Britain will now be cautious and 'prudent'.

He has good reason to fear uncertainty in the UK: as well as Heathrow, Ferrovial is a major shareholder in the airports of Aberdeen and Glasgow in Scotland and Southampton on the south coast, owning 50% of the capital in each, as well as significant construction and services activity in Scotland and England.

These figures translate to nearly a third of the firm's income derived from Britain and the country being among the Spanish firm's biggest markets.

This said, Del Pino speculates whether Brexit may bring the unexpectedly positive upturn of the British government's decision on the proposed third runway.

For decades now, talks on how to extend Heathrow airport – the largest of the London terminals and the UK's main long-haul departure and connecting point – have failed to bear fruit, but in two months' time, a public opinion poll on whether or not to include a third runway will close and be ready for Parliament to vote on it.

Perhaps in a bid to offset potential loss of foreign investment, the British government will be more open to Heathrow's expansion, believes Del Pino.

“This could mean that in three or four years, we could start to build a new runway or a new terminal within the airport [Heathrow already has five terminals, with T5 opening in 2008] in order to increase our current capacity by 30% or 40%,” says Ferrovial's managing director Íñigo Meirás.

“We're not going to invest any more in thye UK, but we're not going to de-invest either,” Del Pino, Ferrovial's main shareholder, explains.

“We'll have to look at the process cautiously – not just because of the effects it might have on Britain, but also on the whole of Europe.”

Looking on the bright side, the likelihood of a loss of confidence in the UK economy thanks to Brexit could lead to interest rates falling, which would help growth and up inflation, meaning shares in the country would also be worth more in foreign currencies.