IAG: shares stronger after acquisition of Air Europa

(CercleFinance.com) - International Consolidated Airlines Group announced a deal to buy Air Europa for 1 billion euros to strengthen its offer from Europe.


The owner of British Airways and Iberia said that the acquisition will push its Madrid hub - which in recent years has lagged behind other European hubs - into a serious competitor with Amsterdam, Frankfurt, London and Paris.

Following this agreement, Madrid will have a better position on Europe to Latin America routes, and the possibility to become a gateway between Asia and Latin America, IAG said.

In particular it should establish IAG as a leader in the highly attractive Europe to Latin America and Caribbean market, the group said.

Furthermore, the deal will be accretive from the first full year.

The acquisition - which will be funded by external debt - is expected to be completed in the first half of 2020.

The London-listed IAG shares were trading 1.4% higher on the announcement.

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