While the United States has often led the world in privatization of utilities and other public assets, there are some assets such as airports and roads in which the U.S. lags behind Asian and European nations. Chicago, however, is in the process of changing the country's attitudes about privatization. Thanks to the Windy City, America moved a step closer to eliminating the privatization gap when the Federal Aviation Administration cleared the city's plans to sell Midway International Airport in what would be the country's first privatization of a major hub airport. This is not the Second-City's first trailblazing privatization. Last year, Chicago leased the Skyway toll road to Australia's Macquarie Infrastructure Group for $1.8 billion. The Midway deal would resemble the toll-road deal because it also will be a long-term lease of up to 99 years. Managing the bidding are Credit Suisse, Bank of America, MR Beale & Co. and Banco Popular. Macquarie is a likely bidder along with Singapore's state-controlled Temasek Holdings, Spain's Cintra and rival Ferrovial, which recently acquired British airport operator BAA, and private equity groups. Because the bidders are foreigners, the privatization could be derailed if a public backlash develops making the sale a political liability for Illinois politicians involved in supporting it. Recently, the plan to sell U.S. ports to Dubai-based DP World led to public outcry leading to Congressional action to thwart the sale. —Matthew Wurtzel
NOTE: Only a day after Chicago made a big splash with its plans to lease Midway, it seems another Midwest metropolis may follow suit. Milwaukee is considering leasing Mitchell International Airport to a private operator, according to the Milwaukee Business Journal, which is holding a poll about the plan.
See story from The Financial Times via MSNBC
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