The directors of Spanish low-cost carrier Vueling have recommended that shareholders accept the revised offer made by British Airways parent company IAG.
Vueling had earlier rejected an offer of 7 euros per share from IAG but has now accepted the revised offer of 9.30 which values the airline at some 277 million euros. The airline’s shares were trading at 9.25 euros before today’s announcement while IAG shares were up by some 3% this morning to 244.33p. Previously, IAG had sought to control some 90% of Vueling’s share capital but, in-hand with the higher offer, had revised this down to just over 50%. As IAG already owns some 46% of Vueling, the actual cost to IAG of the takeover will be minimal.
Willie Walsh, ex Chief Executive of British Airways and now head of IAG, has been chasing Vueling for some time now. The Spanish carrier is one of Europe’s few profitable airlines, contrasting markedly with the huge losses currently being suffered by Iberia, also part of IAG.
Mr Walsh has advised that he does not intend merging the 2 Spanish airlines although, with their conflicting performance, most industry observers fully expect Vueling to keep on growing, just as Iberia shrinks both its route network and number of employees.