Vestager concerned over Aer Lingus owner IAG's bid to buy Air Europa 

Fears proposed transaction would reduce competition for Spanish domestic routes and on international routes

European Commissioner executive vice president Margrethe Vestager, said it 'will carefully assess whether the proposed transaction would negatively affect competition on domestic, short-haul and long-haul routes to and from Spain'.

The European Commission has opened an in-depth investigation into Aer Lingus owner’s IAG’s planned purchase of Spain's Air Europa.

The commission, which oversees EU antitrust policy, said it has concerns that the proposed transaction would reduce competition for Spanish domestic routes and on international routes to and from Spain.

IAG said in response that the deal would boost Madrid's competitiveness and benefit consumers, adding that it would continue to work with the European Commission.

The EU executive said it had 90 working days until November 5 to take a decision and that the airlines had decided not to submit potential remedies during the initial investigation.

"IAG, which flies with Iberia and Vueling among others, and Air Europa are leading airlines in Spain. They are also key providers of connectivity between Spain, the rest of Europe and Latin America," commission executive vice president Margrethe Vestager said.

"We will carefully assess whether the proposed transaction would negatively affect competition on domestic, short-haul and long-haul routes to and from Spain, possibly leading to higher prices and reduced quality for travellers," she continued.

She added that, although the financial situation of many airlines was still fragile, it was important that the recovery of the sector took place in a competitive environment, preserving choice for customers.

IAG, which also owns British Airways and Iberia, agreed to buy Air Europa for €500m in January, after the pandemic cut the initial price in half and IAG struck a deal to defer payments for six years. 

It said the deal is "strategically important" for its future and that of Iberia and said it continues to work with the commission.

The EU probe could delay the completion of the deal, which IAG had hoped would take place in the second half of this year.