International Consolidated Airlines Group (IAG), which owns British Airways, is considering going “cap in hand” to investors, says Oliver Gill in The Daily Telegraph. A €2.75bn (£2.5bn) rights issue is one way it could boost its cash reserves.
Other options include a share placing with major institutional investors or issuing loans that can be converted into shares. IAG has already sold £750m of Avios loyalty points for future flights to American Express. Meanwhile, trade unions Unite and GMB are angry because BA, which announced 12,000 redundancies in April, has refused to rule out asking staff to re-apply for their jobs. A “jumbo-sized” rights issue and “painful” job cuts are drastic measures that have already been factored into IAG’s share price and led to BA being called a “national disgrace”, says Alistair Osborne in The Times. But critics could do with some “perspective”. It is important to remember that IAG is competing with the “likes of Lufthansa and Air France-KLM”, which have already received €9bn and €10.4bn in state bailouts respectively. Self-help is surely better than “having the taxpayer refinance IAG, even if jobs are lost.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Review: Eden Roc Cap Cana – fun, sun and golf in the CaribbeanTravel Eden Roc Cap Cana in the Dominican Republic offers everything from relaxing by the pool to a world-class golf course
-
Reeves delays cash ISA reform, but savers are not out of the woods yetThe chancellor has reportedly delayed plans to cut the cash ISA limit, which were set to be announced at Mansion House on 15 July, and will take more time to consult with the industry
-
AJ Bell: a fine British fintech going cheapOpinion Don’t overlook investment platform AJ Bell, a significantly undervalued British business with an excellent financial base
-
Aim has missed its target – will it recover?Aim, London's junior stock market, has become less appealing to investors amid scandals and an upcoming inheritance tax blow next April. Will it make a turnaround?
-
Investors remain calm as the Middle East war unfoldsConflict in the Middle East has failed to shake oil or stock markets. Can the peace hold?
-
London's new private stock market Pisces 'faces three big problems'Opinion The Pisces exchange may fill a gap in the market, but it won’t address the real problem, says Matthew Lynn
-
Spectra Systems: a 'boffin-led' tech stock with business acumenOpinion Patient investors will get paid well as they wait for success from Spectra Systems, a promising Aim stock, says Jamie Ward
-
How amateur investors could rescue UK stocksPrivate investors must be the beneficiaries of a stock market recovery, says Bruce Packard – not brokers and fund managers
-
The British railway industry is in rude health – here's why investors should jump aboardThe railway industry has bounced back from the devastating impact of the pandemic and is entering a new phase of development – and profitability
-
A cyclical case for UK stocksOpinion Depressed margins and relatively low valuations mean the UK market could rally strongly as conditions improve, says Cris Sholto Heaton.
