International Airlines Group (“IAG”) confirmed today that its offer to acquire the 54% of Vueling’s shares that it does not already own has been accepted by the majority of Vueling’s shareholders.
This means that IAG will control just under 91% of Vueling, effectively giving it control of the airline. Vueling will officially become part of IAG from Friday 26 April 2013.
This is significant for IAG. It is the second airline to be acquired by the group since it formed in 2011 and Vueling will be the third member airline of IAG. It gives IAG a true pan-European low cost carrier that is both profitable and cash generative. The acquisition takes place against a backdrop where European legacy carriers are restructuring their short-haul operations. Lufthansa is moving short-haul flights from German airports other than Frankfurt and Munich to Germanwings and Air-France KLM is establishing a new low cost brand “Hop!”.
We explore what role Vueling may play in IAG in this post.