LONDON, UK: International Airlines Group (IAG) has agreed with Globalia to acquire the remaining 80 per cent of issued share capital of Air Europa.

The consideration is €400 million, including €200 million upon closing, comprising €100 million in IAG ordinary shares and €100 million cash, followed by a further €100 million payable in cash on each of the first and second anniversaries of closing.

The agreement is subject to regulatory and other approvals, which could take around 18 months. This agreement follows the conversion made by IAG on 16 August 2022 of a €100 million seven-year unsecured loan to Globalia into a 20 per cent equity stake in Air Europa.

The Board of International Airlines Group believes that the Acquisition remains strategically important for the Group and positions it to benefit from growth opportunities in the Latin America and Caribbean market, as well as to increase connectivity to Asia.

IAG has a strong track record of maximising synergies from previous acquisitions.

Luis Gallego, IAG´s chief executive, said: “This agreement will enable IAG’s Madrid hub to compete on an equal footing with other European hubs and consolidate its position in the South Atlantic. Madrid is the main gateway between Latin America and Europe and there are opportunities to expand its network, providing significant benefits to our customers, employees and shareholders.”

The Acquisition will provide opportunities for IAG to unlock value across three key areas:

• Integrating Air Europa into the existing Iberia hub structure at Madrid.
• Creating commercial links between Air Europa and other IAG operating companies, in addition to inclusion into IAG’s joint businesses.
• Enabling Air Europa to benefit from IAG Loyalty and IAG Cargo and IAG’s common technology and procurement services.

Air Europa is a well-recognised brand and one of the leading private airlines in Spain, currently operating scheduled domestic and international flights, including European and longhaul routes to Latin America and the Caribbean. It carried 13.1 million passengers in 2019, 4.3 million in 2020, 5.0 million in 2021 and 10.0 million in 2022. Air Europa currently has an operating fleet of 50 aircraft with 15 aircraft on order via aircraft lessors. All aircraft are on operating lease, apart from one Boeing 737 finance lease.