BAA, the airports operator, has received approval from bondholders to refinance its massive debt burden.

At a meeting on Tuesday the bondholders, who own £4.7 billion of debt, voted to move to a new structure backed by income from Heathrow, Gatwick and Stansted airports.

In return, BAA will gain better terms and its interest payments will fall. The movement of the bondholders into this new structure will allow BAA to move ahead with the refinancing of the rest of its debt.

BAA said: "This outcome represents a significant step in the re-financing process."

Ferrovial, the Spanish infrastructure company, bought BAA for £10.1 billion two years ago and took on nearly another £6 billion in pre-existing debts. Ferrovial has tried to restructure the debt because interest payments have hit £1.5 billion a year but the credit crunch repeatedly delayed the process.

There had been concern that the deal with bondholders could be scuppered by a hedge fund client of UBS, which owned a parcel of debt. This fund had refused to back the refinancing, leading to a showdown at yesterday's meeting. However, BAA said it had received overwhelming support from other bondholders and the motion was passed.

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