Purchase Air Europe To Iberia enters the final stretch. If the acquisition is completed in a second attempt with Brussels approval, the airport Madrid-Barajas has hopes of putting itself on an equal footing with its main European rivals. Once the operation is completed, the former flagship airline estimates it will attract at least 1.6 million passengers a year to the Madrid terminal. “The scale allows for greater connectivity and drives additional demand,” Iberia sources say.

This Monday, YAG Group – parent company of Iberia, British Airways, Vueling o Air Lingus – carried out the official registration of the purchase file in public competition institutions. The proposal, the above-mentioned sources assure, involves a greater rescheduling of flights than in the first attempt to take over the airline. Globalia. The notice came four years after the operation was first announced, in November 2019, when the agreed amount was $1 billion. After canceling the operation, the price remained at 500.

Iberia remembers the importance of the operation’s success as “European airlines face challenges.” increased competition from other regions and other continents”. “We need stronger and more efficient companies. A stronger group of airlines will strengthen Europe’s competitiveness compared to airlines from other regions such as the Americas or Asia,” they add.

The addition of aircraft from both airlines will precisely open up routes for Asia, instead of the predominance that now exists regarding Latin American destinations. Moreover, from the company he heads Fernando Candela They remember that the development of Barajas against the background of other main European competitors depends on a “yes” from Brussels.

“Iberia and Air Europa together will have a share similar to that of the main
European airlines in their hubs. This will be on par with French airlines in Paris and will remain lower than Lufthansa in Munich or KLM in Amsterdam,” they recall. They all have the same airline anyway.

Moreover, they emphasize that center Madrid will “improve Spain’s position in the global economy.” Specifically, they estimate that the operation will create between 1,250 and 1,800 direct jobs, increase Madrid Airport’s annual revenue by almost 30 million euros, and increase air cargo volumes by 16,000 tons.

In the year to October, 50.36 million passengers have already passed through Barajas, according to Aena statistics. That’s up 21% from the same period in 2022, although still 3.3% less than in 2019, the last year before the pandemic hit. In terms of transactions, it is still 9.6% behind records, although it is 14.1% better in its cargo business.

Deadlines

Thus, the purchase of the airline from the Hidalgo family entered the final countdown. Once the file is officially registered with the European Commission, the first stage begins, consisting of a maximum of 35 working days (extension 25+10). At this stage, Brussels may require additional information from companies, as well as request information from competitors and other industry players.

For example, Irish low-cost airline Ryanair is one of those who have shown interest in the results of the operation and the opportunities it offers for earning money. market share. In the first attempt, others were also interested, e.g. World2Fly or Voloteya.

Community law allows that, after completion of this first stage, the EU will accept the package of concessions proposed by IAG. “However, in complex operations, the EU usually opens Phase II (also known as in-depth investigation), giving you more time to review all documentation.

This second phase may last from 90 to 110 working days (depending on the so-called “clock stops” requested by the parties or the Commission itself. After this, public institutions can ask companies to clarify the details of their package Facilities. Some tasks that will continue to run confidential until negotiations with Brussels are completed.

Although IAG and Iberia are confident that their proposal will fully address the Commission’s possible concerns. Currently IAG already owns 20% of Air Europa, following the conversion of a 100 million unsecured loan to Globalia in August 2022. Air Europa, which has a lot of debt and Covid loans to repay, is growing in terms of operating profit.

“After a grueling preparatory phase, we will work to ensure that the agreement is closed as quickly as possible in 2024,” Iberia emphasizes. The airline claims that approval of the purchase will allow increase routes, frequencies and, thanks to optimization of flight schedules, also flexibility for travelers. This will facilitate the creation of at least 500 new origin and destination combinations.

In this sense, the acquiring company claims that the acquisition will allow improve flight schedules and communications to give consumers more choice. For example, today they offer to fly between Bilbao And Good Aires stop in Madrid. Merging both airlines and adjusting their schedules will allow for the transition to three schedules with shorter connections. And “the same thing will happen in many other ways,” they say.

Deck Expansion

With El Prat’s expansion stalled due to a lack of political agreement, airport manager Aena launched the Barajas expansion and commissioned the development of terminal designs. T4 And T4S for 10.85 million euros.

The technical assistance work includes the development of the necessary preliminary documents and construction plans that define the activities and serve as the basis for bidding for the expansion work of these terminals. For the expansion of the capital’s airport, 1.7 billion is planned for activities in the above-mentioned terminals and 700 million for a new processing building and reconstruction of terminals 1, 2 and 3.

Just a few days ago, Ena also announced the restart of Zone 1 Airport City Adolfo Suarez Madrid-Barajas through consultations with representatives of the real estate and logistics sectors.

The airport manager will review the release of so-called Zone 1 assets to the market, land for logistics use located in a premium area of ​​high demand and considered to have high economic value. These soils are located near A-2Spain’s main logistics center and one of the most important in Europe (also known as “Corredor del Henares”), adjacent to the airport.