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In the papers - Wednesday, 27 February 2008

BAA could be forced to sell one of its airports as Ferrovial, its Spanish owner, admitted that it is at least three to four months away from completing the refinancing of the enormous debts incurred when it purchased the UK airports operator...

...Ferrovial is increasingly desparate to cut debt interest costs, a significant factor in the almost halving of profits it unveiled yesterday - The Independent

Ferrovial, the Spanish infrastructure group that controls British airports operator BAA, said yesterday it hoped to have its much delayed £9bn debt refinancing ready by the middle of the year. The company warned that timing was still contingent on improved credit market conditions while pricing the deal would also depend largely on final tariff caps at Heathrow airport - The Financial Times

Ministers have colluded with Britain's worst-performing train company to conceal the true extent of its failures and exaggerate the compensation package for passengers, according to a passenger watchdog. First Great Western (FGW) admitted yesterday that it had misled the Department for Transport over the number of trains that it had cancelled - The Times

Stephen Nelson, the chief executive of BAA, has quit, amid growing concern that the beleagured airports operator faces sever debt problems. BAA, which owns Heathrow and Gatwick, will confirm his departure today, sources close to the company said - The Times

Stephen Nelson, the chief executive of BAA, the airport operator, is to step down as the group faces one of its most crucial periods since it was taken over by Spain's Ferrovial - The Guardian

Nelson will be replaced on April 1 by Colin Matthews, the former chief executive of the water group Severn Trent and a former British Airways executive - The Guardian

The move comes as BAA braces for a negative ruling from the Civil Aviation Authority on landing fees at Heathrow, its largest asset, and as the group prepares for the opening of terminal five at Britain's largest airport at the beginning of next month - The Guardian

Nelson was promoted to chief executive in July 2006 when BAA was bought by Madrid-based conglomerate Ferrovial in a £10.1bn deal - The Guardian

It is understood that the BAA chairman, Sir Nigel Rudd, decided that a new boss was needed to guide the business through a difficult debt refinancing, to lead the campaign for a third runway at Heathrow and to deal with the consequences of a new regulatory regime for Britain's largest airport owner - The Guardian

The airport group generates cash flow of around £1bn per year but those funds are consumed by capital expenditure of between £1bn and £1.5bn per year and annual interest payments of around £840m. Analysts have warned that BAA will run out of cash by the end of the year if it does not refinance its debts, which were loaded on to the group as part of the Ferrovial-led takeover- The Guardian

The new BAA chief executive has a strong CV, including a spell in charge of Hays, the business services group, and a period as director of technical operations at BA - The Guardian

Stephen Nelson is to step down as chief executive of Heathrow airport operator BAA in the most dramatic bout of management turbulence to hit the group since its £10bn takeover by Spain's Ferrovial. The departure of Mr Nelson follows an avalanche of criticism of failing service standards at BAA's three London airports, Heathrow, Gatwick and Stansted during the past year - The Financial Times

The diversion of water to Beijing for the Olympics threatens the lives of millions of peasant farmers in China's north-western provinces, a senior Chinese government official said. In an interview with the FT, An Qiyuan, a member of the Chinese People's Political Consultative Committee for Shaanxi province and former Communist party chief of Shaanxi, warned of an impending social and environmental disaster because of overuse of scarce water resources - The Financial Times

FirstGroup, the UK's largest train operator, was warned it could lose its most important franchise unless it implemented an unprecedented set of performance-improvement measures imposed by the government. The Department for Transport said it was serving a formal notice on the Aberdeen-based company requiring it to reduce the number of cancellations on its First Great Western franchise and to make other improvements costing a total of £29M - The Financial Times

The number of people awarded vocational qualifications has risen to a record high, but the pace of growth has continued to slow, suggesting that the government will be hard-pressed to meet ambitious targets to boost skills - The Financial Times

Jose Manuel Barroso, president of the European Commission, yesterday challenged Nicolas Sarkozy to use his European Union presidency to push through ambitious environmental targets. Mr Barroso told the FT at a meeting in Svalbard Norway that the French presidency, which begins in July, would have to ensure the ambitious targets were agreed by European member states and parliament - The Financial Times

To its opponents, China's Three Gorges dam on the Yangtze River is all the more tragic because it has a historical precedent. Built in the 1950s the huge Sanmenxia – literally Three Gates Gorge – dam in central China is today regarded as a catastrophic failure with senior Communist party officials blaming it for many of the environmental and social problems that afflict the region. The Sino-Soviet engineering team that designed it was asked to control flooding, produce electricity and improve transport on the Yellow River – the same reasons cited for building the Three Gorges dam, which after 13 years of construction is now nearing completion - The Financial Times

An earthquake was felt across large parts of England in the early hours today. Tremors were felt in Merseyside, Birmingham, Leicestershire, Bedfordshire, Norfolk, Surrey and Greater London at 12.55am – Daily Telegraph

Water bills are to rise to a record high this year with the average household paying £330, the official regulator announced yesterday – Daily Telegraph

The country's worst performing rail company has been warned it could lose its franchise unless services improve over the next 12 months – Daily Telegraph

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