According to a research paper published by Laurent Belsie, when airports are purchased from government by private equity funds, this improves customer experience and increases income generated by such facilities.
Further the number of airlines and routes served increases as a result of private equity.
Private Equity led to the purchase of 102 out of 437 airports that have been privatized recently.
The number of passengers on every flight increases when Private Equity is involved.
“Evidence from satellite image data indicates that PE owners increase terminal size and the number of gates. This capacity expansion helps enable the volume increases and points to the airport having been financially constrained under previous ownership,” research report read in part.
…PE firms tend to attract new low-cost carriers to their airports, which in turn may lead to greater competition and offer consumers better service and lower prices. With regard to routes, PE acquirers increase the number of new routes, especially international routes, more than other buyers. International passengers are often the most profitable airport users, especially in developing countries.
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