IAG will sell Norwegian stake if no deal

first_imgPhoto: Norwegian. IAG boss Willie Walsh says the airline group will sell its 4.6 percent stake in Norwegian Air Shuttle if the Scandinavian carrier doesn’t entertain a takeover bid within a year.IAG revealed the stake in April, saying it was intended “to establish a position from which to initiate discussions with Norwegian, including the possibility of a full offer for Norwegian”.The European airline group, which includes British Airways and Spain’s Iberia,  said at the time it considered loss-making Norwegian an attractive investment.But no discussions had taken place at the time and it appears none have occurred since.“There’s no immediate hurry. But this time next year, if we haven’t acquired Norwegian, we won’t be holding those shares,” The Irish  Independent quoted Walsh as saying late last week.“If we’re not acquiring it, we’re not interested in being a shareholder. We’ll wait and see what happens, but it’s not a big issue on our agenda.”An acquisition of Norwegian by IAG would take out a troublesome rival.The low-cost carrier has grown rapidly to become one of Europe’s biggest LCCs, flying to more than 150 destinations worldwide with a growing fleet of Boeing 787 Dreamliners, 737 MAXs and 737-800s.READ Lufthansa the latest to look at Norwegian.It has been a serious thorn in the side of full-service carriers since it started trans-Atlantic flights five years ago and for British Airways since it began the UK’s first long-haul, low-cost flights to the US in 2014.In the UK, it now carries 5.8 million passengers a year from London Gatwick. Edinburgh and Manchester airports to 50 destinations worldwide, including 11 in the US.IAG launched its own low-cost offshoot, LEVEL, to counter Norwegian’s rise on the trans-Atlantic market and Walsh said it would continue to use the airline to deliver a strategy that would have accelerated with the acquisition of Norwegian.Meanwhile, Norwegian reported a new passenger record in July as it carried almost 3.8 million passengers for the month, up 13 percent on the previous year.Total traffic in revenue passenger kilometres grew 33 percent, compared to capacity growth of 35 percent, to produce a network-wide load factor of 93 percent.Chief executive Bjorn Kjos said the airline was pleased an increasing number of passengers in Europe, USA, South America and the Middle East were flying with Norwegian.“It is also satisfactory that even with a strong capacity growth our load factor is high,’’ he said.“Our capacity growth is still high, but it is not increasing as rapidly as in previous months, which is in line with our strategy.“We have been through a long period of strong growth and going forward we will reap what we have sown for the benefit of our customers, staff and shareholders.”last_img

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