Qatar Airways buys 9.99% stake in BA and Iberia owner IAG
Qatar Airways has purchased a 9.99% stake in the owner of BA (British Airways), Iberia and Vueling – International Consolidated Airlines Group, SA (IAG). The ₤1.15 billion ($1.7 billion) investment will strengthen the state-owned Qatari airline’s existing ties, the company said on Friday.
Qatar Airways said it might consider raising its stake in IAG over time, adding that for the moment it has no intention of increasing its current 9.99%.
European Union (EU) regulations do not allow non-EU shareholders to hold a majority stake (50% or more) in an EU airline.
Qatar Airways says it may increase its stake in IAG at a later date.
His Excellency Mr. Akbar Al Baker, Group Chief Executive of Qatar Airways, said:
“IAG represents an excellent opportunity to further develop our Westwards strategy. Having joined the oneworld alliance it makes sense for us to work more closely together in the near term and we look forward to forging a long-term relationship.”
IAG Chief Executive Willie Walsh said in a statement:
“We will talk to them about what opportunities exist to work more closely together and further IAG’s ambitions.”
Europe’s major airlines, such as British Airways and Iberia, which are dependent on long-haul flights for much of their business, have been facing growing competition from emerging-market carriers, especially from the oil-rich Gulf states.
IAG is currently trying to acquire Irish national flag carrier Aer Lingus. Last weekend it increased its offer to €2.55 per share, which values the airline at €1.36 billion ($1.53 billion). The Irish government, which has a 25.1% stake in the company, is under intense pressure from opposition parties and unions to block the deal.
Qatar Airways Company Q.C.S.C. (Arabic: القطرية), which operates as Qatar Airways, is Qatar’s state-owned flag carrier. Its headquarters are in the Qatar Airways Tower in Doha.
The company operates a hub-and-spoke network which links more than 125 destinations across the Middle East, South America, North America, Oceania, Asia, Central Asia, and the Far East from its base at Hamad International Airport.
The airline, which employs over 31,000 workers, has a fleet of more than 100 aircraft. It has been a member of the Oneworld alliance since October 2013.