Ferrovial, owner of the UK’s biggest airports, faces a Hobson’s choice.

The inflated price the Spanish conglomerate and its consortium partners paid for BAA in 2006 always meant it had very limited room for manoeuvre. Developments – the credit crunch, a competition investigation and a proposed regulatory settlement less generous than hoped – have reduced that room almost to zero. Last week Ferrovial announced BAA’s operational cash flow, £1bn in 2007, remains insufficient to meet its interest and capital expenditure bill. Cash flow at Ferrovial’s other businesses was only €85m, group interest costs were €1.8bn, and year-end consolidated net debt represented 10 times earnings before interest, tax, depreciation and amortisation.