Iberia tires of suitors who want to test the waters first
Spanish airline says it will only consider "firm" bids.
21 December 2007
MADRID - Leading Spanish airline Iberia has declined to open its books to would-be suitor Gala Capital and will only consider binding offers for the company.
A consortium of Spanish investors led by the Gala Capital fund has made a takeover approach to Iberia at a tentative price of between EUR 3.6 and EUR 3.9 per share. Gala wanted access to Iberia's books as a prior step to lodging a possible firm offer for the carrier.
Iberia has been the object of takeover speculation ever since the United States and the European Union signed an open-skies deal earlier this year liberalising flights across the Atlantic. Iberia, which has a strong presence in Latin American routes, is seen as an attractive option to take advantage of the agreement.
The Spanish airline has acknowledged that consolidation in the airline industry is inevitable and has stated its intention to take an active part in the process. The carrier has given its chairman, Fernando Conte leave to provide information to potential investors with "real" interest in "some significant corporate deal."
Snubbing Gala's advances, Iberia said it wanted to focus on the targets set out in its current business plan, which aims to improve the efficiency of the carrier.
According to a statement filed with the National Securities Commission the stable environment it required to meet those targets had been "undermined by the drawn-out process of analysis by interested third parties who have not tabled a binding offer."
Iberia had provided financial information to a consortium led by US private equity firm Texas Pacific Group and including British Airways, which has a 10-percent stake in the Spanish carrier. The TPG group had said it was contemplating an offer at 3.6 per share, but eventually dropped its interest in Iberia.
Any takeover of the airline, however, has been complicated by recent changes to its shareholder structure. Caja Madrid, which along with BA is one of Iberia's core shareholders, recently acquired stakes of syndicate members BBVA, a Spanish bank, and local logistics company Logista. As a result the Spanish savings bank now holds a 23.3-percent interest in Iberia and has stated it has no plans to sell out.
In its statement yesterday Iberia nonetheless left the door open to a "firm offer" for the company.
[Copyright EL PAÍS, SL./ A. SIM 2007]
Subject: Spanish news