IAG offers fixes to win EU nod for €400 million Air Europa deal

British Airways parent IAG SA offered new concessions to European Union competition regulators in a bid to allay concerns over its €400 million ($430 million) takeover of Air Europa.  

“We submitted a new remedy package with some adjustments compared to the previous one,” IAG said in an emailed statement. “It includes improvements that have come from the constructive dialog we have been maintaining with the European Commission, with the aim of ensuring that the acquisition of Air Europa is carried out with all guarantees for consumers.”

The commission said on its website it set a new deadline of Aug. 20 to decide if the deal should be cleared after the proposed remedies were handed in on June 10.

IAG’s move comes after doubts were cast on the future of the deal following a formal warning that the takeover could hamper competition on multiple routes within Spain as well as connections with the rest of Europe, the Middle East and the Americas. 

Domestic routes lacking high-speed train alternatives could be particularly hard hit, the regulator warned in April.  

This week’s concessions are said to include a list of proposed remedy takers for routes IAG and Air Europa will have to ditch in order to appease EU concerns. For long haul routes, IAG has pledged to offer routes to Avianca, World2Fly and Iberojet, and for short haul the company has selected Ryanair, Volotea and Binter for certain routes.      

IAG is seeking EU approval for the deal a second time after an earlier attempt was thwarted by intense scrutiny from regulators. Their second bid to get the deal cleared comes as Brussels regulators are ramping up their scrutiny of large airline deals — increasingly calling for robust concessions. 

©2024 Bloomberg L.P.