On August 1, British Airways owner IAG terminated its proposed takeover of Spain’s Air Europa, citing regulatory environment concerns, less than two months after it offered remedies to antitrust regulators to secure approval for the deal, Reuters reports.
IAG had offered concessions to the European Commission in June after the watchdog warned the deal could reduce competition. EU antitrust regulators had been poised to block the deal after IAG declined to offer additional remedies to address their concerns, people with direct knowledge of the matter said.
“It doesn’t make sense for our shareholders and that’s the reason we are abandoning the operation,” IAG Chief Executive Luis Gallego told a press call on Thursday.
Gallego confirmed that the European Commission said the concessions offered by the group were not enough.
Analysts said IAG’s decision was unsurprising, but prompted questions about where IAG may turn its acquisition interests in the future. Portugal’s TAP is seen as a potential target for acquisition.
IAG said it would pay Air Europa €50 million (US$54 million) as a termination fee.
IAG had announced last year that it would buy out the 80% of Air Europa it did not already own for €400 million. The company would retain its 20% stake in Air Europa.
It first made an attempt to bid and take over the carrier in 2019.
