Fraport, the owner-operator of Brnik-based Aerodrom Ljubljana this week confirmed the delisting from the Slovenian stock-exchange of the country’s primary airport, formally bringing to a close the privatisation of the once state-owned travel hub.
Whilst ratifying its actual limited liability company status, Fraport have for some time in all but name held an overwhelming majority stake in its 2014 acquisition but until the absorption of the final 3% of shares had been undertaken, its hegemonic hold on the airport couldn’t be legally reclassified.
Paying well in excess of €230 million for the airport, a level of risk is inevitably factored into such an investment although, Fraport’s track-record of operating Frankfurt Airport – a far more substantial facility than the one at Brnik – would’ve instilled a large degree of confidence when Ljubljana passed from state to private hands. Where though there is risk in such financial speculation this is more than just a leap of faith from Fraport, rather, more a show of confidence in an airport that reached a glass-ceiling under its previous auspices. An airport rather than an airline will always prove to be a more attractive proposition, with growth, expansion and diversification involving a greater array of routes and airlines ensuring a fresh approach from the new owners of an airport, something the relatively narrow remit of a regional airline such as Adria Airways cannot compete with. There is also scope to widen the commercial appeal of the terminal’s interior, offering a greater choice for consumers on the flight-side of operations.
Whilst Adria have started routes to Berlin and Stockholm from Brnik, it will be interesting to see how Fraport react to the decision from the airline to kick-start Maribor Airport’s desire to become a low-cost, regional hub. Getting the ball rolling with a new service linking Slovenia’s second-city with London(Southend), more routes are anticipated for 2016 although I expect the aforementioned route to be used as a test-case, to measure its success and Maribor Airport’s viability as a long-term future partner. Ljubljana Airport in the past made the error of being too cosy with Adria, something Fraport will wish to distance itself from and also, a scenario Maribor will do well to be wary of. If Maribor Airport tie-in their future with just one airline, the uncertain future of the ‘will it, won’t it be privatised’ status of Adria could undermine confidence, a situation Delavska hranilnica, Maribor’s majority-shareholder, will wish to avoid. Perhaps sensing the need to diversify its roster of bases, Adria have recently added the Polish city of Lodz to its portfolio. Viewed as an unusual choice to many but with several geopolitical analysts forecasting that Poland will emerge as one of Europe’s economic powerhouses, this could yet prove to be an astute choice.
In Ljubljana Airport Fraport have bought a solid piece of infrastructure that nevertheless stands on the runway, waiting for permission to take off. In what direction this will be is as of yet unconfirmed but there is no frivolity about the German-based company’s level of investment. Now they have full control of their own destiny, I fully expect future developments to be ratcheted up to levels that just weren’t possible in the airport’s state-owned days.
Further reading on this subject can be viewed at: The Slovenia Times: Fraport formally announce Ljubljana Airport’s delisting