A deal that would have added Air Europa to the IAG family of airlines has fallen through, at least for now. IAG, which includes British Airways, Iberia, Aer Lingus, Level and Vueling, had originally planned to buy the Spain-based carrier for €1 billion in 2019.
Globalia, Air Europa's present owner, and IAG announced in late December that they had called off the sale and set late January as a target for seeing what other ways they could collaborate. IAG will pay Globalia the €40 million 'breakup fee' specified in the original deal, as well as an additional €35 million with the agreement that there would be no litigation, and that the €35 million would count as a down payment if a future deal is reached.
With air traffic and airline finances heavily impacted since 2020 by the pandemic, the two companies had agreed in July, 2021 to cut the prince in half, but the deal's final blow was the likely veto by EU regulators who indicated that the reduction in competition in Spain would not be allowed. Iberia's offer of dropping some routes in return for approval was considered insufficient.