What If The UK And Spain Could Jointly Agree On A Bailout At The IAG Level?


Boris Johnson’s government would be looking for ways to take a stake in UK airlines such as Virgin, Easyjet or British Airways. Last weekend, the Financial Times said the British government intended to inject millions of pounds in exchange for shares in the companies. These would later be sold to private investors, just as the US government did with firms from various sectors during the 2008 financial crisis.

The main problem is that British Airways is part of the IAG group, based in Spain.

Another formula flagged by the newspaper is that if Iberia also needs help, the UK and Spanish governments could jointly agree on a bailout at the IAG level. This operation would dilute the participation of the main shareholders, led by Qatar (25.1% of the capital).

In principle, Renta4 analysts believe it is premature to take these measures. They also have confidence in the group’s plans to reduce costs and investments, recalling it has 9.3 billion euros in liquidity.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.