The European Investment Bank (EIB) said on Friday it planned to put the debt it extended to British airport operator BAA into a ring-fenced securitisation structure, the first creditor to sign up to a migration plan.

BAA, which belongs to Spanish construction-to-services group Ferrovial, said earlier this month that it planned to move existing bondholders into an investment grade, ring-fenced securitisation structure backed by designated assets.

The plan is part of a refinancing of about GBP10 billion pounds of debt, which BAA originally hoped to get done by the end of last year but has had to rework because of the credit crunch. It now hopes to complete the refinancing by the third quarter.

In a joint statement with BAA, the EIB said it had agreed to increase the debt available for the airport operator to draw by GBP50 million (USD$99 million) to GBP439 million.

The companies said the deal was dependent on the refinancing being completed by mid-July 2008.

The general BAA securitisation plan is being backed by London's Heathrow, Gatwick and Stansted airports and the rail link between Heathrow and central London. BAA hopes to swap the financing into bonds over time.

BAA has said it plans a separate bank debt-financing backed by the other UK airports it owns. Banking sources have said that part of the financing will be around EUR1.2 billion euros.

The two plans will help refinance the GBP10 billion of debt Ferrovial took out to buy BAA in 2006, on which interest payments have doubled to around GBOP.5 billion over the last few months as the credit crunch bit.