Spain to have say in Aer Lingus owner's Air Europa takeover deal

Spain has approved a €475m aid package for Air Europa. File picture: Steve Parsons

The Spanish government will have a say in the potential sale of local airline Air Europa to Aer Lingus owner IAG.

IAG agreed to buy Air Europa for €1bn last November, but is seeking to reduce the price amid the travel crisis caused by the Covid-19 pandemic.

However,  now Spain has approved a €475m aid package for Air Europa. The airline is the first major Spanish company to tap into funds established to help companies in strategic sectors weather the pandemic.

The package will comprise a €240m equity-backed loan and a €235m regular loan.

In return, Spain’s government will have a say on Air Europa's potential sale to IAG, a government spokeswoman said, without giving details on what role Madrid would want to play.

The spokeswoman said the government “reserved the right to give an opinion and decide criteria” on the possible deal, without elaborating.

She also said the government wanted to participate in the nomination of the airline’s chief executive and in any layoff plans.

IAG said, last week, that it would wait and see what conditions the Spanish government would attach to its help for Air Europa and said it had to look at “everything” about the deal as so much had changed for the airline industry.

• additional reporting Reuters