Gloucestershire Airport is now costing local taxpayers an estimated £2.7 million annually, more than double the previous loss of £1.4 million, following the collapse of a major sale deal, council leaders revealed.
The Staverton-based airport, co-owned by Cheltenham Borough Council and Gloucester City Council, was on the market with an asking price of £25 million. However, after over eight months of negotiations, the intended sale to Horizon Aero Group fell through earlier this month. The breakdown was attributed to the final offer being significantly lower than the original agreed price.
Council leader Jeremy Hilton addressed the overview and scrutiny committee, stating, “Nobody is to blame; it’s just one of those things where a sale fell through.” He acknowledged the efforts of Horizon Aero Group’s chief executive and the bidders who worked hard to secure the deal, even extending deadlines to facilitate the purchase.
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Hilton highlighted that most interested buyers were consortiums, and emphasized the considerable efforts of council officers and external agents in managing the complex sale. Despite the setback, he affirmed that the airport remains operational and described maintaining its operations as the short-term priority.
He explained that selling the airport was not his preferred option but necessary to secure investment for critical upgrades, including new hangars, modern radar systems, and the development of the proposed CGX business park. These improvements aim to attract higher-value business jets, which generate more revenue through landing and service fees compared to smaller private aircraft.
When questioned about the timing of realizing the sale would fail, Hilton indicated it became apparent only in the final weeks when the last offer from Horizon Aero Group was deemed unacceptable by council officers.
The collapse of the sale also affects the council’s financial plans, particularly the ability to repay a £15.5 million emergency Government bailout loan. The anticipated £4.5 million capital return from the sale, which would have contributed to recovery efforts, is now lost, prompting the council to explore alternative financial strategies.
City Council head of place Andy Hearne confirmed that the airport’s operating loss has increased from an initial £1.8 million to approximately £2.7 million across the two councils—a rise of about £450,000 per council. Legal, consultancy, and agent fees related to the sale process amounted to a relatively modest £150,000.
Looking ahead, Hilton stressed the need for calm and careful consideration regarding the airport’s future. Immediate objectives include reducing the current losses, with the airport board and shareholders expected to discuss actionable steps.
Though uncertainty remains, the council remains committed to preserving the airport’s operations while exploring viable solutions to secure its financial sustainability and potential growth.