British Airways’ owner IAG is to make a €113 million bid to buy the rest of Spanish carrier Vueling.
IAG said yesterday (November 7) that it was considering the purchase of the rest of Vueling’s shares. IAG currently owns 45.85 per cent of Vueling.
The company has now formally launched a cash offer to buy the remaining 54.15 per cent of Vueling which it said will cost it €113 million based on an offer of €7 per share. IAG said the purchase would be funded “using internal IAG resources”.
IAG chief executive Willie Walsh said: "With its leading position in Barcelona, European growth strategy and low-cost base, Vueling has much to offer IAG.
“It has significantly increased capacity while remaining profitable, despite the Spanish economic slowdown, and already has extensive commercial arrangements with Iberia. We would plan to retain the current Vueling management team.
“This would be good news for Vueling as there are many advantages for the airline in this deal. It will benefit from the financial strength of a larger airline group, making it better able to compete with other airlines and invest in new customer products and services.
“The airline will also be able to generate some cost and revenue synergies as part of IAG mainly through joint financing and procurement.”
The deal means that Vueling is valuated at around €208.6 million.