International Consolidated Airlines Group (IAG) is making a cash tender offer to buy 100 per cent of the share Vueling, the Spanish low-cost airline based in Barcelona.
The offer will be launched exclusively on the Spanish stock markets and Veloz Holdco SLU has been created as an IAG subsidiary for this transaction.
IAG's subsidiary Iberia owns 45.85% of Vueling's shares currently and the Iberia board has agreed not to tender them in the offer. This means that Iberia would retain its shareholding in Vueling with IAG seeking to acquire the remaining 54.15%
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The offer will be €7.00 per ordinary share of Vueling with the total cost of acquiring 54.15% anticipated to be €113m. It will be funded using internal IAG resources.
IAG chief executive Willie Walsh said: "With its leading position in Barcelona, European growth strategy and low cost base, Vueling has much to offer IAG. It has significantly increased capacity while remaining profitable, despite the Spanish economic slowdown, and already has extensive commercial arrangements with Iberia. We would plan to retain the current Vueling management team."
The reported total assets of Vueling as at September 30th were €805m and in the nine months to September 30th it generated profits before tax of €59m.
An application for authorisation of the offer, along with the prospectus and other legal documents, will be submitted within the next month to the Comisin Nacional del Mercardo de Valores (CNMV).
Subject to authorisation from the CNMV, the offer will be launched to Vueling's shareholders in the first quarter of 2013 and, if accepted, the deal is expected to be completed in the second quarter of 2013.
The offer will be subject to a minimum acceptance condition of 90% of the voting rights of the Vueling shares not already owned by Iberia. It is not subject to regulatory approval by the European Commission.
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