SPANISH invasions of England have never run smoothly. King Philip II sent his Armada in 1588, only to see it repelled first by fierce English resistance and then severe Atlantic storms.

Rafael del Pino, chairman of Grupo Ferrovial, one of Spain’s largest construction and infrastructure groups, must know how the king felt.

Del Pino’s own invasion — a daring, £10.3 billion takeover two years ago of the airports group BAA — has been blown off course by the unexpected storms of terrorism and the credit crunch.

Last week came the local resistance, a hard-hitting inquiry from a competition watchdog that is likely to lead to the break-up of Ferrovial’s British empire.

If the Competition Commission follows through on the “emerging thinking” it unveiled last week, some believe it will spark a complete shake-up of British civil aviation. Ferrovial could be forced to sell not one but as many as three airports (Gatwick, Stansted and Edinburgh). The 20-year-old system of regulation could be scrapped, and the painful debate about the location of new runways in southeast England (see adjoining panel) could be reopened.

Del Pino has declined to speak publicly about the report — the company said it was focusing its attention on a crucial refinancing of BAA — but aviation industry executives who have met him recently say he feels aggrieved, and believes that the British have “moved the goalposts”.

He can, however, take some comfort that the expected break-up is unlikely to leave Ferrovial and its co-investors out of pocket. There will be a queue of bidders if it is forced to sell, with foreign airport groups and the new wave of global-infrastructure funds all eager to buy.

Ferrovial is already making the preparations. The all-important refinancing, which should be completed within months, is being structured so that one or more airports can be easily separated if the need arises. Heathrow will not be sold.

The 169-page report makes grim reading for BAA executives. In remarkably plain language for what is an interim statement — the final verdict follows in August — it says BAA’s ownership of the three large London airports (Heathrow, Gatwick and Stansted) and the two largest in Scotland (Glasgow and Edinburgh) has stifled competition.

That is just the start. It goes on to say BAA has a poor view of what airlines want, rates poorly for passenger service, has appeared reluctant to bring forward new runway capacity and is, despite boasting about its expertise in planning and project management, able to tackle only one big programme at a time.

The mauling delighted airline executives, who have long-held grievances against BAA. “It is a great piece of work, the sort of thing the Civil Aviation Authority should have produced years ago,” one said.

Sir Michael Bishop, chairman of BMI British Midland, said: “The majority of airlines at Heathrow are fed up with being treated as second-class citizens.”

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