Newspaper article The Evening Standard (London, England)

[Pounds Sterling]60m Deal to Save Crisis-Hit New Air Traffic Control

Newspaper article The Evening Standard (London, England)

[Pounds Sterling]60m Deal to Save Crisis-Hit New Air Traffic Control

Article excerpt

Byline: JOANNE HART;MARK BENHAM

A [pound]60MILLION rescue deal has been pieced together to save the recently part-privatised National Air Traffic Services.

The Government is to put in [pound]30million and four leading banks are to contribute the rest.

The funding comes after suggestions that Nats was on the brink of being plunged into administration, prompting a fresh crisis for Transport Secretary Stephen Byers.

Today bankers said that they have agreed to lend the company the extra money which should tide it over until the end of the year.

The Government has also been forced to stump up taxpayers' money for the cash-strapped company.

In return Nats is applying to the Civil Aviation Authority for permission to charge airlines more for using British air space.

Nats' crisis was prompted by the 11 September terrorist attacks in America.

Air travel plummeted and the company, which is funded by airlines flying over Britain, found itself desperately short of money.

The group was privatised last year despite a barrage of criticism from aviation experts.

The [pound]623 million new national air traffic centre opened last month at Swanwick, near Southampton. It was six years behind schedule and will take two years before there is any significant increase in the capacity of flights handled. The Government now owns 49 per cent of it and the rest is owned by a group of airlines and Nats staff.

As part of the privatisation deal, Nats was lent [pound]1.4 billion by four banks - Barclays, Abbey National, Halifax and Bank of America. Half of that money was used to pay for the privatisation and the rest, which was intended for capital expenditure, has not been touched.

At a board meeting today, Nats finance director was expected to tell directors that he has secured the [pound]60million emergency money. …

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