Iberia closes the purchase of Air Europa for 500 million

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Iberia has finally signed the purchase of Air Europa more than a year after the announcement of the operation. It will finally be for 500 million euros, and not for the 1,000 initially agreed, according to Europa Press, which indicates that the operation will close today.

Iberia, which belongs to the IAG group (which also owns British Airways and Vueling, among others), will pay this amount in five years to the Globalia group, which owns Air Europa. The government rescued Air Europa almost two months ago. This rescue was the condition that Iberia had set to continue with the operation.

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Iberia will pay half the price initially agreed (in November 2019) when considering that Air Europa, which has avoided bankruptcy thanks to the state bailout, “is no longer worth the same as before the crisis”, in the words of Luis Gallego, president of Iberia when the operation was announced and current CEO of IAG.

Iberia has discounted from the initial price the two loans of 475 million euros granted by the Government, which will be executed through the fund for strategic companies in distress managed by the Sepi.

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In the last few weeks the price and conditions were being renegotiated. The bailout of the state meant that Sepi had two advisers on Air Europa’s governing body and could decide on the choice of CEO, but Iberia wanted freedom to run the company and possible adjustments, once acquired.

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