London City Airport Protects £130m Lifeline Amid Business Travel Decline
The owners of London City Airport have injected £130 million in new equity to stabilize the airport’s finances amid a prolonged slump in business travel.
The move comes as the airport struggles to recover from the pandemic, with passenger numbers still following pre-Covid levels.
The new capital was provided by a consortium of Canadian pension funds – AIMCo, OMERS, and the Ontario Teachers’ Pension Plan – and Kuwait’s Wren House. These funds are used to reduce debt, pay interest, and strengthen reserves, giving the airport some breathing room as it prepares to renegotiate more than $700 million in loans due in March 2026.
London City, which relies heavily on corporate travel, has lagged behind major airports such as Heathrow in its recovery. By 2023, London City will welcome 3.4 million passengers, down from 5.1 million in 2019. Despite an expected increase of 4 million passengers by 2024, this is still less than 20% below pre-pandemic levels.
The airport’s efforts to increase the number of passengers were also hampered by the government’s decision to block the expansion of weekend services, although it increased the number of passengers per year from 6.5 million to 9 million. Reaching this new limit is expected to be challenging without additional weekend flights.
A spokesperson for the City of London said: “Since the start of the pandemic, we have seen an increase in passengers year on year, with free travel now representing close to 60% of passengers at our airport. London City is a profitable company with supportive, long-standing shareholders.”
This cash injection marks another chapter in the airport’s ownership, which has included the sale of Irish billionaire Dermot Desmond and the subsequent 2 billion acquisition by a Canadian-led consortium in 2016.
