Efforts didn't work and the German group Lufthansa has finally confirmed that it has ended the negotiations to acquire a stake in the Spanish company Air Europa, a spokesperson for the German firm confirmed on Tuesday, after the Franco-Dutch group Air France-KLM withdrew from the talks last week.
This development confirmed earlier reports that Lufthansa had been effectively eliminated by the Hidalgo family, which owns Air Europa. Lufthansa CEO Carsten Spohr had also said the operation had "very little chance of success."
"After a thorough analysis and intensive negotiations, we have decided, at this stage, not to proceed with the capital contribution and equity stake in Air Europa," a spokesperson for the German company said, as reported by Bloomberg .
In February, the media reported that Lufthansa was interested in acquiring up to 25% of the Spanish airline's capital , which is 80% controlled by Globalia, which is owned by the Spanish Hidalgo family.
Specifically, Air France-KLM CEO Benjamin Smith announced last Thursday that he had ended talks with Globalia to acquire a stake in Air Europa because an agreement had not been reached.
In January of this year, Air Europa announced the hiring of PJT Partners as an advisor in its search for new investors, seeking capital to repay the €475 million debt it has held since the pandemic. That same month, interest from both Air France-KLM and Lufthansa was confirmed.
Furthermore, the Spanish firm already carried out a capital increase at the end of last year to balance its assets, with contributions of 65 million from Globalia and 16 million from IAG , which joined to avoid diluting its 20% stake in Air Europa.
In this context, IAG maintains that its stake in Air Europa is a "financial" matter and that it will consider any measure in this regard based on "whether it makes sense or not."
Regarding the Turkish airline, it confirmed last June that it was in "non-binding" talks with Air Europa to evaluate "the investment opportunity" in the company "and explore possible synergies."
Turkish also indicated that it will communicate any information regarding any developments that may occur and that are related to investor decisions.
The possible sale of Air Europa has been on the table for over five years , after Brussels aborted the entry of IAG, the group that includes British Airways, Iberia, Vueling, Aer Lingus, and Level, which ultimately abandoned the purchase due to restrictions imposed by the European Commission's competition services .
With Lufthansa and Air France-KLM withdrawing from the bidding, the only rival still interested in the acquisition is Turkish Airlines, which officially announced on June 20 that it was holding non-binding talks to explore a potential investment in Air Europa.
The Hidalgo family is considering offers that would limit external participation to a maximum of 25% because they want to maintain operational control of the airline. However, IAG, which owns 20% of the company, also has a say in the transaction.
Photo Courtesy : LSZH Spotter
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