4th Nov 2019 07:56
(Alliance News) - International Consolidated Airlines Group SA said Monday it has acquired Spanish airline Air Europa for EUR1 billion in cash from Globalia.
Air Europa operates domestic and international flights to 69 destinations, including long-haul routes to Latin America, the US and North Africa.
In 2018, Air Europa generated EUR67 million in pretax profit on revenue of EUR2.1 billion. Over the same period, IAG - which already owns Iberia and Vueling in Spain, as well as British Airways and Aer Lingus - generated EUR2.89 billion pretax profit on revenue of EUR24.41 billion.
"Acquiring Air Europa would add a new competitive, cost effective airline to IAG, consolidating Madrid as a leading European hub and resulting in IAG achieving South Atlantic leadership, therefore generating additional financial value for our shareholders," IAG Chief Executive Willie Walsh said.
"IAG has a strong track record of successful acquisitions, most recently with the acquisition of Aer Lingus in 2015, and we are convinced Air Europa presents a strong strategic fit for the group", Walsh added.
The buy will be funded from debt with the deal expected to complete in the second half of 2020. IAG has agreed to pay a EUR40 million break fee should the transaction fail to achieve regulatory approval, resulting in the acquisition being cancelled.
By Ahren Lester; [email protected]
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