Iberia and Air Europa give each other time: airlines agree to terminate acquisition agreement in exchange for 75 million euros
Source：businessinsider
From：Taiwan Trade Center, Barcelona
Update Time：2022/01/17
After countless obstacles to formalize the purchase of Air Europa by Iberia, the airlines have reached an agreement to prevent the operation from failing.
The Hidalgo's airline and the Spanish subsidiary of International Airlines Group (IAG) have confirmed in a statement to the National Securities Market Commission (CNMV) that negotiations are at an advanced stage to terminate the agreement signed on November 4, 2019 and amended on January 20, 2021.
In exchange, they have agreed to a consideration of 75 million euros from Iberia to Air Europa, according to El Confidential.
With this they manage to avoid the blockage by the European Commission, which in its binding opinion was going to impose a series of conditions that made the merger impossible.
The integration of both companies is of interest both to the Government and to the companies themselves, so this extra time is key to close a new agreement that will not be vetoed by Brussels, and this is what the Competition authorities of the European Commission, which were due to decide on January 4, have been informed.
Brussels was going to impose unacceptable conditions given the current situation, as expected by the companies, and that is why they have asked to suspend the procedure.
Part of the pact they have reached includes Iberia's payment to Globalia's owner of 75 million euros as an advance payment and which includes an 'a posteriori' purchase option to avoid a millionaire claim by Hidalgo, according to sources close to the negotiations.
Also avoids the possibility of opening negotiations with Lufthansa, as the businessman said, which would be a strategic blow to Spain's tourism business.
Source: https://www.businessinsider.es/iag-globalia-rescinden-acuerdo-adquisicion-air-europa-980925