A teaser document for the sale, being handled by Morgan Stanley, was sent out last week to prospective bidders.

Serious suitors are required to register their interest by this Friday, including details of their credentials and financing arrangements. The full memorandum will then be sent to selected parties.

The teaser route is likely to have been taken because of amount of interest in the airport. Sources suggest that London City Airport's central location could attract a range of potential buyers, including infrastructure companies, infrastructure funds, property companies and private equity investors.

The four-page teaser does not put a price on the airport, but fast-growing airports have been selling at high multiples.

Belfast airport was sold to Ferrovial in 2003 for 18 times EBITDA, while Budapest airport sold for nearly 30 times EBITDA last year. Last Friday's winning bid by Ferrovial for airport operator BAA values the company at about 15 times estimated earnings.

Desmond's airport has been growing faster than the regulated BAA-owned airports.

Even taking a multiple of 20 times earnings would value London City at £380m, based on last year's numbers, and earnings could be expected to grow by 20% this year.

The airport complex stands on 120 acres, with an option to develop five acres of dockland, the teaser notes. It says the airport had £45m in consolidated revenues of £45m in 2005, and EBITDA of £19m, and that the property for sale includes a 10,500 square-metre terminal, 14 aircraft stands and 800 car parking spaces.

The document also notes that the airport has undergone certification tests for both the Airbus A318 and the Embraer 170, and that operating those aircraft from the airport would significantly increase its passenger volumes and range of destinations.

Because of its short runway and limited parking capacity, London City has mainly been used for scheduled short- to medium-haul services. The Airbus 318, for which now defunct Irish company JetMagic carried out the certification test last year, can carry 109 passengers.

London City Airport opened in 1987 as part of a government regeneration plan for a derelict area around Canary Wharf. Desmond bought it in 1995 from construction company Mowlem for £23.5m, so a sale at expected levels will deliver a stellar return.

The number of travellers using UK airports is expected to grow by 40% to 400 million by 2020, according to British Department of Transport forecasts, and the down-to-thewire battle for BAA last week is indicative of the level of interest in good infrastructure assets.

Ferrovial was partnered by one of Canada's biggest pension funds and the private equity arm of the Singapore government. Goldman Sachs' consortium, pipped at the post after Ferrovial adviser Citigroup launched a raid on BAA's shares on Friday morning, included another Canadian pension fund, Australia's Colonial First State Bank and US insurance giant AIG. A deal is expected by September.