Heathrow to invest £2.3bn in upgrade after Saudi Arabia's PIF takes stake

London airport has boosted its investment plans days after Saudi sovereign wealth fund and French firm Ardian complete deal

Heathrow said its two-year upgrade will improve all terminals, including baggage delivery. Reuters

London's Heathrow is to spend £2.3 billion ($2.92 billion) upgrading the airport over the next two years.

The move is an increase of £244 million on previously forecasted investments, and comes days after Saudi Arabia's sovereign wealth fund, PIF, and French investment firm Ardian completed their deal to buy a 37 per cent stake in Heathrow.

The investment is the largest of its kind in UK transport infrastructure, and will be used to improve all terminals, including baggage delivery and projects to support punctual departures and arrivals, Heathrow said. The plan is to spend £1.05 billion upgrading the airport’s infrastructure next year and £1.29 billion in 2026. Heathrow has invested £1.1 billion in 2024, including spending £191 million on upgrading security lanes.

“Heathrow is the UK’s gateway to the world, and ultimately, the country’s gateway to growth,” the airport's chief executive, Thomas Woldbye, said. “Today’s announcement confirms that we will continue to invest more than £1 billion of private sector cash each year into the airport to deliver facilities our airlines and passengers want, while boosting the UK economy and creating opportunities for businesses up and down the country.”

Last week, Saudi Arabia's PIF and Ardian completed a €4 billion ($4.2 billon) deal to buy a combined 37.62 per cent stake in Heathrow from Spanish construction giant Ferrovial and other shareholders of FGP Topco, the parent company of Heathrow Airport Holdings. Ardian and PIF acquired 22.6 per cent and 15 per cent respectively of FGP Topco. Ferrovial, which builds and manages highways and airports, is focusing on expansion in the United States, where it is building a terminal at New York's JFK International Airport.

Heathrow executives are predicting a record festive season for passenger numbers, with a 21 per cent increase on Christmas Day alone. Last month, 6.5 million people travelled through the airport, its best November performance. Heathrow has been breaking its own records for most of 2024. It had four consecutive months of record passenger numbers in the summer and its busiest week ever from August 13 to 19, when 1.8 million people passed through the airport.