After extensive negotiations, the Hidalgo family is evaluating two competing offers for the partial sale of Air Europa, both involving capital injections and debt restructuring.
- Lufthansa proposes a €240 million investment through a 25% capital increase, enabling the airline to repay its debt to Spain’s SEPI (State-Owned Industrial Holdings Company).
- Air France-KLM offers €300 million for a 51% stake, along with full assumption of the airline’s debt to the Spanish government.
Lufthansa's Stability Plan vs. Air France-KLM's Takeover Offer
According to El Confidencial, Lufthansa’s plan focuses on financial stabilization, subscribing new shares to settle the €240 million participatory loan—part of the €475 million bailout granted by SEPI in 2020, which carries interest rates ranging from 2% to 9%.
Meanwhile, Air France-KLM, advised by Société Générale, proposes a majority acquisition, valuing Air Europa at €600 million and assuming its existing debt, bringing the total operation to approximately €1.1 billion. Under this deal:
- The Hidalgo family would retain a 29% stake.
- IAG (owner of Iberia) would maintain its current 20% shareholding.
Debt Repayment and Future Financing Plans
Air Europa’s state loans are due in November 2026, but the airline aims for early repayment of the participatory loan to reduce financial costs and strengthen its capital structure. Once this is completed, it plans to refinance its ordinary loan through bank credit or bond issuance, ultimately severing ties with SEPI.
Strategic Considerations: Liquidity vs. Long-Term Growth
Javier Hidalgo is leading the negotiations, weighing:
- Lufthansa’s offer, which aligns with Air Europa’s initial plans and fosters long-term synergies.
- Air France-KLM’s proposal, which provides immediate liquidity.
Hidalgo believes Air Europa could surpass a €1 billion valuation if the tourism demand remains strong, especially after two consecutive record-breaking years, with revenues of €2.9 billion and an EBITDA exceeding €200 million.
Lufthansa-Air Europa Partnership and European Commission Hurdles
As part of its approach to Air Europa, Lufthansa has signed a leasing agreement with the airline to operate flights between Brussels and New York, allowing for an intercontinental route assessment.
At the same time, some Hidalgo family members favor Air France-KLM’s bid, recalling the failed sale to IAG, which was blocked by European Commission-imposed conditions. However, regulatory approval from Brussels could take up to a year, delaying the monetization of the deal.
Comentarios
Para comentar, debés estar registrado
Por favor, iniciá sesión