Germany eyes Britain's air-traffic control service.

Germany has admitted it is interested in acquiring a stake in Britain's air-traffic control service in a deal that could revolutionize control of the skies in Europe.

Deutsche Flugsicherung (DFS), Germany's state-owned air-traffic service, believes the flow of air traffic from north-west to south-eastern Europe means there could be benefits from acquiring the Government's 49pc stake in Britain's National Air Traffic Services (NATS).

"We believe there could be good co-operation," a DFS spokesman said. "We already have good co-operation with NATS and the operational side of the business is not bad."

George Osborne, the Chancellor, said in his emergency Budget last year that the Government was ready to sell its stake in NATS, which could be worth more than £500m, to raise public funds.

However, progress has been slow and the prospect of selling control of Britain's airspace to a foreign investor is likely to be controversial.

DFS, which manages Germany's military air traffic as well as civil aircraft, is understood to have asked investment banks to pitch as advisers on a potential deal last week.

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