BA ends 10% shareholder discount on 31 January 2015

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British Airways Logo (Image Credit: British Airways)
British Airways Logo (Image Credit: British Airways)

Before the formation of International Airlines Group (IAG) in early 2011, British Airways offered shareholders (who held shares above a certain minimum) a 10% discount on BA flights booked with the airline.

It was very popular with private shareholders and a self-funding means of acquiring substantial savings for frequent flyers.

The future of the discount has been the subject of much speculation as it was never extended to other IAG airlines Iberia and Vueling. Nor was the BA discount ever offered to former Iberia shareholders or new shareholders in IAG.

Last month IAG announced its intention to resume dividend payments to shareholders after a long hiatus.

Following this, IAG has now confirmed that the shareholder discount scheme will end on 31 January 2015.

Here is the text of the e-mail sent to shareholders.

I am writing to advise you that from midnight on 31 January 2015 the shareholder discount scheme for former British Airways shareholders will come to a close.

Since the merger in January 2011 we have been reviewing the discount scheme. It was kept open to former British Airways shareholders, but it has not been available to former Iberia holders or new IAG shareholders. It has never been available to institutional shareholders, who own the majority of our shares.

After continuing with the discount for almost four years, with the recent announcement of our intention to resume dividend payments we feel it is the right time to close the scheme. We will of course continue to offer competitive prices via and hope that you will continue to support British Airways’ business.

However, you will still have the opportunity to book flights using the shareholder discount between now and midnight on 31 January 2015. Flights can be booked 355 days in advance.

Whilst we appreciate that this will come as a disappointment to some of you, in reality the take-up of the discount was extremely low and feedback from shareholders has been that they value a dividend more. We hope that in light of the dividend announcement you will continue to support us as a valued shareholder.

We welcome any thoughts and comments below: