Aviation

IAG negotiates half-price deal for Air Europa

After agreeing to purchase Air Europa prior to the COVID-19 pandemic, International Airlines Group (IAG) has managed to significantly reduce the price it will pay for the Spanish carrier.

Under the original agreement with Globalia announced in November 2019, IAG’s subsidiary, Iberia, was to acquire rival Air Europa for €1 billion ($1.6 billion).

However, IAG announced last week that both parties have agreed to a reduced purchase price of €500 million ($784.4 million), with payment deferred until the sixth anniversary of the acquisition’s completion.

The revised terms in the amendment agreement are conditional on negotiations between Iberia and Sociedad Estatal de Participaciones Industriales (SEPI) regarding the non-financial terms associated with the financial support provided by SEPI to Air Europa during 2020.

Assuming the revised agreement’s conditions are met and it is approved by the European Commission, IAG expects the acquisition to be completed in the second half of 2021.

“Both Iberia and IAG are demonstrating their resilience to face the deepest crisis in aviation’s history,” IAG chief executive Luis Gallego said.

“Being part of a large group is the best guarantee to overcome current market challenges, which will also benefit Air Europa once the transaction is completed.

“I am pleased that we have reached [an] agreement with Globalia to defer payment until well into the expected recovery in air travel following the end of the pandemic, and when we expect to be realising significant synergies resulting from the transaction.”

Iberia CEO Javier Sánchez-Prieto said: “This transaction makes perfect strategic sense to reinforce Madrid’s hub competitiveness on a global stage.

“It will benefit consumers and Air Europa’s incorporation into the Iberia Group will improve the company’s viability benefitting both Iberia and Air Europa employees.”

Javier Hidalgo, CEO at Globalia, said: “This transaction is a great effort by all of us and is the best way to recover tourism, transport in Spain and the Madrid hub.”

Air Europa operates scheduled domestic and international flights on European and long-haul routes to Latin America, the United States of America, the Caribbean and North Africa.

The airline carried 13.1 million passengers in 2019 before seeing passenger volume declining by roughly 70 per cent in 2020.

Air Europa currently has an operating fleet of 52 aircraft compared to 68 at the end of 2019. All aircraft except one are on an operating lease.


Featured image source: iStock/herraez



SEE WHAT PEOPLE ARE SAYING

Leave a Reply

Destinations

Skip the rebound surge with South America

For clients eager to travel overseas again but wanting to avoid the summer disruptions, leave Greece or California for another time and head to South America.

Share

CommentComments

Destinations

Events

Top 12 unmissable events for Italian summer trips

Summer in Italy means sunshine, gelato, promenading after dinner, Aperols overlooking the ocean, hiking, cycling…and a jam-packed events calendar.

Share

CommentComments

Aviation

Airport queues return in anticipation of the school holidays

If you were looking for a good chance to relisten to Led Zeppelin’s entire discography but can’t find the time, we recommend booking a flight to literally anywhere from Sydney or Melbourne airport this month.

Share

CommentComments

Destinations

Queensland government mulls tourism tax

In response to this, the NSW government will be introducing an ice-cream tax, which has infuriated primary school kids across the state.

Share

CommentComments

Destinations

South Africa drops all remaining COVID restrictions

Meanwhile, we’ve decided to keep mask-wearing optional in Travel Weekly’s office, mainly to protect us against the office dogs’ various… smells.

Share

CommentComments

Travel Agents

AFTA and CLIA bring back NTIA and the port & destination showcase

Polish your dancing shoes because it’s industry events galore as the two peak bodies reveal the return of two much sought-after happenings.

Share

CommentComments

Aviation

Breaking News

Jetstar CEO to step down as Qantas promises $5,000 boost to employees and more domestic capacity cuts

It’s a day of mixed emotions for Qantas and Jetstar staff today, with bouts of cheering and sobbing breaking out at an alarming rate.

Share

CommentComments

Events

Save the date! Hawai‘i Tourism Oceania announces dates for ‘Aloha Down Under’ roadshow 2022   

by sponsored by Hawai‘i Tourism Oceania

Get your diaries out because Australia and New Zealand’s biggest annual Hawai‘i Roadshow, Aloha Down Under, is on from the 22nd to 29th August 2022. 

Share

CommentComments

Hotels

Marriott launch home rental collection for ANZ

Marriott has launched its new home-rental collection while the Travel Weekly staff have decided to launch a Pokémon cards collection. It’s not quite as significant but at least it’s something.

Share

CommentComments

Road & Rail

Avis launches high-end car rental brand for luxe travellers

Got any clients looking to indulge in their midlife crisis without going the whole hog? We’ve got good news.

Share

CommentComments

Travel Agents

TravelManagers announce speakers for national conference

We heard that the muppets will be there, but we have been watching a lot of Sesame Street lately so we could be getting confused.

Share

CommentComments

Aviation

“I thought I was going to die”: Passenger plane catches fire on runway

Don’t worry, the photo shows a white chemical foam used to put out the fire, not a random snowfall confined to a 30-metre area in Miami as you may assume from a first glance.

Share

CommentComments