Aer Lingus and British Airways owner IAG has taken a 20% stake in Spanish low fares airline Air Europa.
The development has come about by IAG exercising its option to exchange a €100m seven-year unsecured loan to Air Europa owner Globalia for a 20% stake in Air Europa.
IAG – which also owns Spanish airlines Iberia and Vueling – agreed to buy Air Europa, for €1bn, in 2019, with the price tag dropping to €500m last year.
However, the acquisition – which was due to be executed through Iberia – was scrapped at the end of 2021.
But, last March, at the time of making the €100m loan, IAG chief executive Luis Gallego, said that the group remained “convinced” about the strategic importance of a deal.
With a fleet of around 40 planes, Air Europa is the third largest airline in Spain, after the IAG-owned Iberia and Vueling.
While owning the three largest Spanish airlines could be a difficult idea to get past the European Commission’s competition authorities, the loan gave IAG a one-year exclusivity period to negotiate fresh acquisition terms for Air Europa.
