dme
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LH Has An Agreement With IB

Tue Apr 10, 2007 11:40 pm

Dear all,

According to the newspaper "El Mundo" (in Spanish,
http://www.elmundo.es/mundodinero/20...be1e5f5b81b338ed2c5c&t=1176215416)
LH has a verbal agreement with IB to buy it at 4€ per share (11% higher than TPG), i.e., something like 3800 million euros. If that is true, it will be predictable then that a Spanish group will join LH; ¿the Marsans Group, i.e., Spanair, Air Comet, and Aerolíneas Argentinas?. In that case the future company will be headed by a Spanish but the financial and commercial parts will be headed by the Gernans.

Regards,
DME.

Pd. Perhaps that is the agreement which has been taken place between the Spanish and German governments after the German electrical company E.On fiasco on the Spanish Endesa.
 
LHStarAlliance
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RE: LH Has An Agreement With IB

Tue Apr 10, 2007 11:48 pm

Wow that´s an interesting article , IMO at the end LH will takeover IB , it´s perfect for the South America routes also the fleet is almost identical .
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jimyvr
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:05 am

However, on 09APR07 edition of ATWOnline, Lufthansa says current IBERIA shares is "over-priced".
1000 - 01MAR07 | http://airlineroute.blogspot.com/
 
PanHAM
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:07 am

Quoting Dme (Thread starter):

Pd. Perhaps that is the agreement which has been taken place between the Spanish and German governments after the German electrical company E.On fiasco on the Spanish Endesa.

Why should the Spanish Government feed a cookie after they massively intervened on the E.ON purchase? Why should the German government get involved in the transactions of a private company? LH is not under Government control.

For the same reasons they tried to keep Endesa Spanish, they must by any logic try to keep Iberiaq Spanish.

Next - Iberia is 60% privately held, Banks hold: 10% Caja Madrid, 9% BBVA, Airlines hold : 10% BA, 1% AA and the rest is held by corporations like Logostica, Ahorra and El Corte de Ingles. Any buyer must make an offer to the present shareholders.

Anyway, most interesting point is rather that LH would get ample slots at a modern airport with lots of capacity far enough fron the present hubs. If that offer is real, LH must issue an ad-hoc notice. They also have their AGN on the 18th April.
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UAL777UK
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:28 am

Jeez, if LH could take control of IB, obviously they would jump to Star and then the whole of that region I.e. TAP is in the same alliance.......Great for Star but surely BA will try and head off an assault by LH as IMHO I thought IB were very important to BA going forward.
 
DALCE
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:29 am

How healthy is IB financially seen?
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AirlineFanatic
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:29 am

BA would be letting an opportunity pass that will change the European landscape especially with Open Skies next year. Congrats to LH if they are successful!
 
atnight
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:37 am

If LH ends up buying and owning IB, what would that do to IB's current r'ship with Oneworld? I really think that BA will be the one who losses the most by IB becoming a part of LH.... Honestly, if BA wants to keep competitive with the other big 2 airlines in Europe (AF/KL - LH), they should consider buying IB themselves and thus securing their position against them... Is not ideal for BA to own IB, but is probably worst for BA not to buy IB.... Also, OneWorld would have hardly any presense in Europe-Latin America and LH would dominate the region by a huge margin (already IB is the leading latin america-europe carrier)..
By buying IB, LH would also benefit StarAlliance as they would gain a huge player that flies to an area they are short of service to... Of course, that would be only if IB left OneWorld and became part of Star, and although it may not be discussed at the moment, the likely of that happening is very much so, as LH would benefit a lot by having IB in their alliance.... Anyways, if by LH buying IB makes it a better airline with better service, then I am happy for IB...
However, personally I would rather not see IB being sold, but if it gets sold, I wish that BA would buy IB...
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dme
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 12:42 am

Quoting DALCE (Reply 5):
How healthy is IB financially seen?

IB has something like 1700 million Euro in cash!.

Regards,
DME.
 
DALCE
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 1:02 am

Quoting Dme (Reply 8):
IB has something like 1700 million Euro in cash!.

That's quite an amount  Smile
flown: F50,F70,CR1,CR2,CR9,E75,143,AR8,AR1,733,735,736,73G,738,753,744,77W,788,319,320,321,333,AB6.
 
atnight
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 1:36 am

Quoting LHStarAlliance (Reply 1):
Wow that´s an interesting article , IMO at the end LH will takeover IB , it´s perfect for the South America routes also the fleet is almost identical .

That's very true... LH biggest long-houl fleet are A340-300/600s and IB long-haul fleet is only A340-300/600... also, out of the major carriers of Europe, they are the only ones that lack PTVs in Y class, thus their IFE service is basically the same...
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PADSpot
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 2:51 am

Quoting Dme (Reply 8):
IB has something like 1700 million Euro in cash!.

LH has about 2,25 billion € of available cash, but what it gives its AAA+ rating can be found more in the details of annual report. Maybe financially the most solid airline of all ... if take a closer look at equity-to-assets ratio, debt rate, provisions etc you get an impression where the money really is. Quite impressive ...
 
IAD380
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 3:17 am

If this report is true, BA probably will submit a competing offer for IB. IB is financially strong, and it has assets that both LH and IB covet, namely a modern aircraft fleet and a strong Latin American route network. Under the circumstances, IB shareholders will benefit from a bidding war. The stakes are high, and I perceive that LH has a lot to gain, but BA has a lot to lose. BA/IB would surely rival AF/KL and LH/LX. However, LH/IB/LX would certainly weaken BA's position in Europe. Also, One World would suffer a severe a blow if IB left the alliance. Whoever buys IB will emerge as a strong competitor to AF/KL on routes between Europe and South America. BA/IB would dominate flights from Europe to the western hemisphere because BA flies to more destinations in North America and the Caribbean basin than any other European airline, and IB flies to more Latin American cities from Europe than any other carrier. If I were the CEO of LH, buying IB would have priority over AZ, even if IB is pricey.
 
Beaucaire
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 3:24 am

Quoting IAD380 (Reply 12):
If I were the CEO of LH, buying IB would have priority over AZ, even if IB is pricey.

Agreed ! - AZ compared to Iberia is an absolute disaster,but even they will find a buyer ...
In my eyes, LH management knows very well about IB's strong assets and the complementarity both airlines would offer.
IB needs a lift in terms of service and customer-appeal - technically their fleet matches very nicely LH's fleet.
Iberia might even become a (small) A380 customer...
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Summa767
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:22 am

Quoting Atnight (Reply 7):
If LH ends up buying and owning IB, what would that do to IB's current r'ship with Oneworld? I really think that BA will be the one who losses the most by IB becoming a part of LH

I am not sure if BA would really lose a lot of LH buying IB. Remember that AA has a huge precence in Latin America, and there is Lan Chile too.
With the new "quasi open skies" between the US and Europe, it should be easier for BA to colaborate more with AA, including more codeshares out of MIA. Further, perhaps LAN could fly directly to London and codeshare on BA flights on onward connections to Europe and beyond.
OneWorld could further increase its hold on Latinamerican by incorporating a Brazilian carrier. For intra-latinamerican flights, IB has no relevance.
 
rootsair
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:50 am

Quoting LHStarAlliance (Reply 1):
Wow that´s an interesting article , IMO at the end LH will takeover IB , it´s perfect for the South America routes also the fleet is almost identical .

would this mean IBeria in *alliance. that would be a big up for *A especially since their south american network has been affected by Varig leaving !

 airplane   wave 
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BA787
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:57 am

Quoting Summa767 (Reply 14):

This is very true.

I'm a bit skeptical about this report, until I see an official LH or IB statement, I will hold out on making an opinion
 
gemini573
Posts: 143
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:59 am

If IB is taken over by LH, oneworld will recruit another airline in LatAm; namely Mexicana. It'll fit their strategy. Have the big carriers namely (AA, BA), feed into the smaller carriers.
 
rootsair
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 5:14 am

Quoting Gemini573 (Reply 17):
If IB is taken over by LH, oneworld will recruit another airline in LatAm; namely Mexicana. It'll fit their strategy. Have the big carriers namely (AA, BA), feed into the smaller carriers.

nevertheless the Europe- LatAm connections will be very much affected. I hardly see anyone flying to South America via Mexico. Via Madrid must be the most direct connection so far. so I doubt MX will be a good replacement. Perhaps AV would suit better !

regards

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Concorde001
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 5:32 am

Why does BA have to worry about anything?

If I'm not mistaken, it seems BA is in a very comfortable position with regards to any takeover over IB

  • BA already owns 10% of IB
  • BA has first right to purchase another 30% of IB

Doesn't this put BA in a powerful position? If those with the 30% decide to sell, they have no choice but to ask BA first, and if BA agrees, then LH has no chance. It seems the ball is BA' court...or very soon will be!
 
IAD380
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 5:39 am

Quoting Summa767 (Reply 14):
I am not sure if BA would really lose a lot of LH buying IB. Remember that AA has a huge precence in Latin America, and there is Lan Chile too.

I disagree with your claim that BA would not lose a lot if LH bought IB. BA would lose IB's hub at MAD which connects much of the traffic between Europe and Latin America. AA's Latin American network is based in MIA (and to a lesser extent in DFW), not Europe. LA could not replace IB as BA's partner. First, SCL is not in a central geographic location for passengers travelling to or from Europe. Second, LA has a minimal presence in Europe since it only operates a daily SCL-MAD-FRA flights. Even if LA started flights to LHR and other European destination, it would not replace the loss of IB's hub in MAD.

Quoting Summa767 (Reply 14):
OneWorld could further increase its hold on Latinamerican by incorporating a Brazilian carrier. For intra-latinamerican flights, IB has no relevance.

LA has already established a strong network for flights throughout Latin America that serves One World passengers well. IB is relevant for travel between Europe and Latin America. I am not sure that bringing a Brazilian carrier into One World would strengthen its position in Latin America. AA handles flights between North and South America, LA flies throughout the region from several hubs, and it offers daily flights from South America to AKL and SYD. After the demise of RG, no Brazilian airline has a strong international presence. However, a Brazilian carrier could give One World relevance in Brazil's large domestic market.
 
stylo777
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 5:48 am

3-4 weeks ago LH published this internally and that they are considering to take over IB, but still monitoring the whole market and the events. This eMail also mentioned that LH isn't averse to buy IB, because of the strong South America market and the leave of Varig.

In my eyes this would be the smartes move after the LX merge LH could do. As already mentioned by all of you LH/LX have almost a non-presence in South America.

Would this affect TP and especially JK? 2 Spanish carriers within the alliance (if IB would enter to Star)? Is that smart? Wouldn't this kill JK?
 
Humberside
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:20 am

Quoting Stylo777 (Reply 21):
Would this affect TP and especially JK? 2 Spanish carriers within the alliance (if IB would enter to Star)? Is that smart? Wouldn't this kill JK?

The future of Spanair would be interesting, especially as they are more than just a Star airline - SAS own a large stake in them and LH/SAS are of course close. Ii doubt SAS would be too happy if their Spanish airline was sidelined to mkake way for IB

I guess the most obvious thing may be for SAS to sell their stake to LH and try and merge JK intro IB, but would that get past the competition authorities?
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Summa767
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:23 am

Quoting IAD380 (Reply 20):
BA would lose IB's hub at MAD which connects much of the traffic between Europe and Latin America. AA's Latin American network is based in MIA (and to a lesser extent in DFW), not Europe

Still, if one wants to fly LON-GUA (or UIO, GYE, BOG, CCS, LIM and so on) it would be a stop in MAD. One could also have one stop in MIA instead.
As you say, LAN with its different bases (Peru, Ecuador and Argentina, as well as Chile) has a good southamerican presence.
For the Europe-Lat Am links, more could be made out of AA and LAN out of MIA, and they could think about asking someone like AV, that is intending on returning to London by next year and has a base in a strategic location and and increasing route map (soon adding more central american destinations, for instance)

Quoting IAD380 (Reply 20):
However, a Brazilian carrier could give One World relevance in Brazil's large domestic market.

Exactly.
 
KLM685
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:28 am

Quoting RootsAir (Reply 18):
nevertheless the Europe- LatAm connections will be very much affected. I hardly see anyone flying to South America via Mexico. Via Madrid must be the most direct connection so far. so I doubt MX will be a good replacement. Perhaps AV would suit better !

And what would the difference be? The most efficient wat to go from Europe to Latinamerica is directly from Europe or via Madrid. AV doesn't have a great Europe network that would secure transit via BOG and MX presence in Europe is none so...
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atnight
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:47 am

Quoting Summa767 (Reply 14):
I am not sure if BA would really lose a lot of LH buying IB. Remember that AA has a huge precence in Latin America, and there is Lan Chile too.
With the new "quasi open skies" between the US and Europe, it should be easier for BA to colaborate more with AA, including more codeshares out of MIA. Further, perhaps LAN could fly directly to London and codeshare on BA flights on onward connections to Europe and beyond.
OneWorld could further increase its hold on Latinamerican by incorporating a Brazilian carrier. For intra-latinamerican flights, IB has no relevance.

I'm sorry to disagree with you, but there is no way IB would not really affect BA or OneWorld... How can you think that AA would provide the right link between south american and Europe? Do you think that pax to-from SCL, EZE, LIM, UIO, BOG, CCS would like to go via the US and what going through inmigration and customs mean? Not to say that most latin pax would need a visa to the US even for transit..
Also, think of those pax who live in Europe... imagine having to go from NCE or a smaller city to LIM for example... NCE-LHR-MIA-LIM... even if you have a direct flight from NCE to LHR, you would have to connect to another HUB to then take your flight... I guess that logic goes against the idea of the future.... unless of course you want every carrier to buy the A380... Anyways, your idea is flawed, and all those pax who fly oneworld would simply change to staralliance... and LH would dominate while BA would really be left out of a huge portion...
And about incorporating a Brazillian carrier, it would only benefit intra-south america, but it wouldn't do much compared to the loss of IB..

Quoting Gemini573 (Reply 17):
If IB is taken over by LH, oneworld will recruit another airline in LatAm; namely Mexicana. It'll fit their strategy. Have the big carriers namely (AA, BA), feed into the smaller carriers.

With all though respect, if connecting in MIA with AA doens't make sense, why would going into MEX make any more sense? on the contrary, it would make people HATE OneWorld when it comes to travel between Europe and Latin America with the exception of very few routes that LA has...

Like I said before (and also what I read in the news), it may not be BA's ideal choice to buy IB, but if they don't try to buy it and someone else gets it, they will loose a LOT more... so they should buy it rather than someone else if they want to be competitive with the other two (AF/KL - LH/LX)...
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Summa767
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:55 am

Quoting KLM685 (Reply 24):
AV doesn't have a great Europe network that would secure transit via BOG and MX presence in Europe is none so...

BA flies to MEX itself. It could do with improving the frequencies though.
AV would be useful for connections via BOG to all of Colombia, plus Ecuador, Peru and, soon, central America. Just additions to LAN's and AA's possibilities.
 
LHStarAlliance
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:05 am

Quoting RootsAir (Reply 15):
would this mean IBeria in *alliance. that would be a big up for *A especially since their south american network has been affected by Varig leaving !

OH yezzz , I´ld love to have IB at *A , Imagine a IB *A A/C !
 cloudnine 


Well they really need it , LA or IB would fit perfectly in *A , or wait for a healthy Varig ...
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Summa767
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:13 am

Quoting Atnight (Reply 25):
Do you think that pax to-from SCL, EZE, LIM, UIO, BOG, CCS would like to go via the US and what going through inmigration and customs mean? Not to say that most latin pax would need a visa to the US even for transit..
Also, think of those pax who live in Europe... imagine having to go from NCE or a smaller city to LIM for example... NCE-LHR-MIA-LIM... even if you have a direct flight from NCE to LHR, you would have to connect to another HUB to then take your flight

You are right about the visa hassle for non- Europe or US passport holders going thru the US. Then if OneWorld does lose IB, theys should move to recruit something like AV, as a non-US transfer point.
In your scenario, for the NCE passenger going to LIM, then One World would not be ideal. SkyTeam and Star would do the business better. Or they could take the fast train to Paris, and fly AA to MIA and down to LIM. (Or going to BCN and flying to BOG and on to LIM if AV were to be incorporated)

Basically, you cannot be all things to all people, but there are ways of getting round IB. After all, Lat Am does not feature greatly in BA's agenda (and should! given the potential for growth in the region). Even better, they could do some flights themselves!
 
BAxMAN
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:20 am

Does anybody else think that Star Alliance getting an increased monopoly on mileage whores from the Iberian Peninsula, through Central Europe and then across to both Turkey and Poland is possibly a bad thing?

Apart from AF/KL and BA (excluding comparatively minor players such as AZ and SN), European mileage hunters would be severely compromised - particularly on intra-European travel.
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gemini573
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:47 am

All these airlines; Austrian, Swiss, SAS, etc benefit one carrier only. LH. They all feed traffic into LH's network.
 
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acontador
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 8:18 am

Just one more thought:
Why do you always connect LA with SCL? It's now many years that LA stopped being Lan Chile!
What does IB offer to South American market? Two things: Direct connections between most big cities and MAD, and access to its big intra-Europe network.
Of course Oneworld could offer same service. LA could offer additional point-to-point services to Europe from EZE, LIM, BOG...you name it. But of course you are leaving out Brazilian market, which compared to the rest is huge. Now where to Europe is another question, as well now LHR is not really suited for becoming Oneworlds hub...and also LAN would need a lot more hardware!
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LH526
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 8:34 am

Quoting Jimyvr (Reply 2):
Lufthansa says current IBERIA shares is "over-priced".

As is so much in spain! See real estate!!!
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jfk777
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 9:11 am

BA service to South Anerica really centers around two places, Mexico City and Sao Paulo. Those are the two nonstop daily from LHR to the Spanish Americas. Iberia is a unique property since most Latins want to go to Madrid from their capitals. KLM-AF & Lufthansa have great links to their own hubs in northern Europe, but not southern Europe. BA needs to keep IB out of LH hand, not matter what. LH has SWISS, SAS & Austrian in Star. BA used to fly to CCS and BOG, why not fly to some Latin cities in the northern tier again ? IB works for BA traffic to central america, ccs, bog, guyaquil, quito, Lima and Santiago de Chile. EZE is an extension of BA's own GRU. The amount of trafiic to all those IB connections for BA probably couldn't fill a 777 every day in aggregate.


Avianca is not with an alliance yet, but Bogota may work as only a regional Panama to Peru tranfer point. Copa in Panama would be a much better connecting point for north and central latin america for BA if they could join ONEWORLD, imagine the BA 744 coming in daily as Copa's afternoon bank leaves for most cities in the region, sounds like problem solved to me.
 
MEACEDAR
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 9:52 am

How bad is IB doing? I thought they were getting a lot of loads.
 
Concorde001
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 10:09 am

It is being reported in tomorrow's edition of The Times (11 April) that IB wants BA to rescue it from a takeover from TPG (because BA has the power to increase shareholding to 40%) and that it is BA's priority to stop a rival airline acquiring IB!

Iberia, the Spanish airline, is hoping that British Airways will be a white knight and increase its shareholding to fend off a private equity takeover.

Iberia said yesterday that it was “very possible” that BA would strengthen its relationship with the airline. BA has a 10 per cent holding in Iberia and rights to a further 30 per cent, which if exercised would effectively block other bidders...

...Enrique Donaire, Iberia’s managing director, said: “British Airways is a shareholder [with 10 per cent] which has a seat on the board. It has a privileged position to promote collaboration up to the point which we consider beneficial to both companies.”

Mr Donaire, in an interview with Iberia’s internal magazine, said that the relationship with BA had gone well between the airports they shared, Heath-row, Madrid and Barcelona. He said that it was “very possible” that Iberia may “strengthen” its relationship with BA.

BA is still considering its options, but the priority is understood to be blocking another airline buying Iberia.


Full article here: The Times - Iberia wants BA to ride to the rescue against takeover bid
 
kiwiandrew

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 2:17 pm

****disclaimer : this is a hypothetical scenario*****

so.... LH owns 29% of BD with an option to buy the rest of SMBs holding at a set price ( can't recall whether this can only be done if SMH agrees to sell, or if the agreement permits LH to force his hand )


.....BA owns 10% of IB with rights to another 30% IIRC and the ability to block another airline from investing


.....SK owns 20% of BD and has made it clear that they want out . SK also owns a small stake in current Spanish Star member JK - it doesn't seem to be clear how they feel about this investment


How much does LH want IB ? How much does BA want BD ? How much does SK want rid of BD and perhaps even JK ?enough to do some back room haggling and try to get a 5 way deal through past the competition authoritees ? LH/SK let BA have BD and strengthen it's LHR hub prior to open skies , in return BA does not oppose LH taking over IB and gains a smaller more manageable replacement partner in the Spanish market which it perhaps even re-brands into a franchise carrier .

Not saying that this could , would or should happen - just thought that it was an interesting idea ... ok , shoot me down now  duck 
 
JoFMO
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 3:48 pm

Quoting Kiwiandrew (Reply 36):
How much does LH want IB ? How much does BA want BD ? How much does SK want rid of BD and perhaps even JK ?

I very much dislike this 5 way scenario. LH should take over BM and BA should takeover IB. That would increase competition in the market.

Quoting Kiwiandrew (Reply 36):
SK also owns a small stake in current Spanish Star member JK

As fas as i know it is nearly up to 100%. Can some Spanish member confirm?
 
stylo777
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RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:00 pm

just want to show you how big the deal would be:

Iberia:
MAD-BOG daily
MAD-CCS daily
MAD-UIO daily
MAD-GRU 2xdaily
MAD-GIG 5xweekly
MAD-LIM daily
MAD-SCL daily
MAD-EZE 2xdaily
MAD-MVD 4xweekly
----------------------------------------
65 weekly flights


British Airways:
LHR-GRU-GIG 3xweekly
LHR-GRU-EZE 4xweekly
----------------------------------------
7 weekly flights


Lufthansa/Swiss
FRA-CCS daily
FRA-GRU-EZE daily
MUC-GRU daily
ZRH-GRU-SCL daily
----------------------------------------
28 weekly fllights
 
rootsair
Posts: 4012
Joined: Sun Feb 06, 2005 3:25 am

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:10 pm

Quoting Summa767 (Reply 23):
One could also have one stop in MIA instead.

People would refuse that dur to transit visa and the hassle of transiting through MIA. Its one of the reasons IB removed its MIA hub altogether!

Quoting KLM685 (Reply 24):
AV doesn't have a great Europe network that would secure transit via BOG and MX presence in Europe is none so...

But Bogota certainly has a more central Geographic position than MEX compared to the rest of Latin America .With the arrival of their 787 they can develop that network or at least add flights to Europe .

 airplane   wave 
A man without the knowledge of his past history,culture and origins is like a tree without roots
 
kiwiandrew

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:35 pm

Quoting JoFMO (Reply 37):
As fas as i know it is nearly up to 100%. Can some Spanish member confirm?

I thought that Marsans group owned the bulk of JK - but it wouldn't be the first time that I have been wrong about something ( wont be the last either ! )
 
dme
Posts: 92
Joined: Wed Mar 17, 2004 11:10 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 4:49 pm

Quoting Kiwiandrew (Reply 40):
I thought that Marsans group owned the bulk of JK - but it wouldn't be the first time that I have been wrong about something ( wont be the last either ! )

Yes, SAS owns something like 95% of Spanair, the rest is owned by Grupo Marsans (which in turn owns Air Comet and AR).

However, do not forget Air Europa, which IMO is quietly observing ...

Quoting Concorde001 (Reply 35):
It is being reported in tomorrow's edition of The Times (11 April) that IB wants BA to rescue it from a takeover from TPG (because BA has the power to increase shareholding to 40%) and that it is BA's priority to stop a rival airline acquiring IB!

Perhaps IB shareholders, knowing that in the end IB will be sold because in the future it will not survive alone, are trying to increase the value. Since in the last instance the European scenario will be for thhree main companies, i.e., AF/KLM, LH and BA, and AF/KLM is out of question, IB tries to be a bride between two grooms, BA and LH.

Regards,
Dme.
 
Bongodog1964
Posts: 3087
Joined: Wed Oct 18, 2006 6:29 am

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 5:12 pm

Quoting Concorde001 (Reply 19):
Why does BA have to worry about anything?

If I'm not mistaken, it seems BA is in a very comfortable position with regards to any takeover over IB



BA already owns 10% of IB

BA has first right to purchase another 30% of IB


Doesn't this put BA in a powerful position? If those with the 30% decide to sell, they have no choice but to ask BA first, and if BA agrees, then LH has no chance. It seems the ball is BA' court...or very soon will be!

This amounts to a stranglehold over the future of IB. LH are in a position that they need the co operation of BA to proceed in any way or form. IMO whilst LH might want IB; they would realise that they need to talk to BA 1st. Of course the shareholders in IB will want as many potential bidders as possible, in order to get the best deal.
 
r2rho
Posts: 2440
Joined: Tue Feb 27, 2007 10:13 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 6:49 pm

Damn!

The rumors that have been brought up in the past weeks are all coming true! I'm glad that this thread is getting more attention than the ones on IB rumors that others and myself brought up here lately, although I still miss a stronger presence from Spanish members - where are you guys?

Quoting Dme (Thread starter):
Pd. Perhaps that is the agreement which has been taken place between the Spanish and German governments after the German electrical company E.On fiasco on the Spanish Endesa.
[quote=PanHAM,reply=3]Why should the Spanish Government feed a cookie after they massively intervened on the E.ON purchase? Why should the German government get involved in the transactions of a private company? LH is not under Government control.

For the good of everyone, I pray that the Spanish and German governments stay out of this! LH and IB have been doing fine as private companies, in spite of and not thanks to their governments. If this becomes another EON-Endesa I'll shoot myself.

Quoting Dme (Reply 8):
How healthy is IB financially seen? IB has something like 1700 million Euro in cash!
[quote=IAD380,reply=12]IB is financially strong, and it has assets that both LH and IB covet, namely a modern aircraft fleet and a strong Latin American route network.

Which is why IB should not just sit around and watch others talk about their takeover. IB is a financially very strong company that is subject to a takeover simply because it lacks the sheer size of LH and BA, not because it's doing bad. If IB's management plays it smart, they can still have a lot to say in this process.

Quoting Summa767 (Reply 14):
Remember that AA has a huge precence in Latin America, and there is Lan Chile too.

No way. AA and LAN serve intra-america routes. But who links them to Europe? Who dominates the South Atlantic? IB does. And currently there is no replacement in Europe for IB and their MAD hub (the 'natural' connection to Latin America and offering the greatest growth potential of all major EU airports). If Oneworld loses IB, it'll leave them with a huge strategic gap.

Quoting Dme (Thread starter):
it will be predictable then that a Spanish group will join LH; ¿the Marsans Group, i.e., Spanair, Air Comet, and Aerolíneas Argentinas?
[quote=JoFMO,reply=37]Can some Spanish member confirm?

Spanair: 94.9% SAS, 5.1% Grupo Marsans.
By the way, Grupo Marsans also owns 94.5% of Aerolineas Argentinas and 100% of Air Comet, which took over some of defunct Air Madrid's routes. Could Grupo Marsans become a player setting up an alternative to IB? Interesting.

It had been discussed some years ago to have Spanair, backed by SAS and LH, expand to fill the gap in Latin American connections for Star Alliance. This would have been the 'home-grown' option, versus the now discussed option of buying IB. From the point of view of competition, I would have much preferred this. There is still room for another Latin America carrier to compete with IB. How about a merged Grupo Marsans-Spanair carrier with participation of LH and SAS, integrated into Star Alliance? Or Grupo Marsans entering Oneworld if IB leaves? Not all is IB.

Quoting Humberside (Reply 22):
I guess the most obvious thing may be for SAS to sell their stake to LH and try and merge JK intro IB, but would that get past the competition authorities?

Now that would be ugly. IB, JK and UX have a very healthy cut-throat competition going on in the Spanish market, merging JK would be very bad news for all Spanish consumers.

Quoting Dme (Reply 41):
IB tries to be a bride between two grooms, BA and LH.
[quote=Concorde001,reply=19]It seems the ball is BA' court...or very soon will be!
[quote=Concorde001,reply=35]Iberia, the Spanish airline, is hoping that British Airways will be a white knight and increase its shareholding to fend off a private equity takeover.

That's right! C'mon BA, make your move!
 
StarFlyer
Posts: 929
Joined: Thu Sep 12, 2002 10:07 am

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:01 pm

Quoting PADSpot (Reply 11):
but what it gives its AAA+ rating can be found more in the details of annual report

Sorry to disappoint you, but Lufthansa is far from being rated AAA+. Its current rating can be found here: http://www.lufthansa-financials.de/s...vlet/PB/menu/1014612_l2/index.html

Moodys: Baa3
S&P: BBB

FYI: A country like Germany only has an AAA (S&P) rating...
Yours truly - StarFlyer
 
stylo777
Posts: 2000
Joined: Mon Feb 13, 2006 7:32 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:08 pm

Quoting StarFlyer (Reply 44):

Sorry to disappoint you, but Lufthansa is far from being rated AAA+. Its current rating can be found here: http://www.lufthansa-financials.de/s...vlet/PB/menu/1014612_l2/index.html

Moodys: Baa3
S&P: BBB

FYI: A country like Germany only has an AAA (S&P) rating...

"With these credit ratings, Lufthansa is the best graded European airline and one of three carriers worldwide with an investment grade rating."
 
r2rho
Posts: 2440
Joined: Tue Feb 27, 2007 10:13 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:14 pm

To summarize some points/my opinion:

1. Given its financial and geo-strategic position, anyone smart would want IB, whether BA, LH or whoever. BA and LH seem to make the most sense because of their complementaty route structure. LH could buy AZ for cheap instead but they would have a lot of cleaning up to do. IB is the expensive option but you're getting a very healthy airline.

2. There is currently no substitute to IB and it's MAD hub, and whoever gets IB will gain this strategic advantage. The only other way to gain a Latin America route network would be to grow an alternative to IB from one of the existing Spanish carriers (JK, UX, Grupo Marsans). Sorry but most non-Spanish EU hubs are oversaturated and just won't work for Latin America. Spain has historically always been the natural link between them and the EU.

3. This whole operation is BA's to lose, not LH's or TPG's to win. It is up to them to make a move or not. Personally I would prefer BA to take over IB; I think they would make a better fit. But if not, then let LH have them - or anyone but TPG, please!

4. LH/IB is only viable if IB leaves Oneworld and enters Star. This means JK would have to be sacrificed, either being merged into IB (which would create competition issues in Spain) or being kicked out of Star (which SAS would certainly not like). It could become quite a mess. Like I said, BA/IB in Oneworld is a much more natural fit.

...This is all going to be very interesting!
 
aerosol
Posts: 497
Joined: Mon Oct 23, 2000 10:31 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:29 pm

I my opinion: LH should not do it - why? - to different culutres. Swiss was easy to integrate - geographical nearness, same language and roughly the same culture.

Integration of Iberia-> I see fights fights fights which will be keeping the management busy for years to come - Spainish Unions vs. the German Occupier
 
LHStarAlliance
Posts: 2096
Joined: Sat Nov 18, 2006 9:15 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:38 pm

Quoting Aerosol (Reply 47):
I my opinion: LH should not do it - why? - to different culutres. Swiss was easy to integrate - geographical nearness, same language and roughly the same culture.

That´s my biggest concern , it will be very difficult to fit IB in a German Company , OS would fit here far better than IB
Boycott The Olympic Games In Beijing !
 
PanHAM
Posts: 8538
Joined: Fri May 06, 2005 6:44 pm

RE: LH Has An Agreement With IB

Wed Apr 11, 2007 7:57 pm

Quoting Aerosol (Reply 47):
I my opinion: LH should not do it - why? - to different culutres. Swiss was easy to integrate - geographical nearness, same language and roughly the same culture.

Same language? If you ever worked for a Swiss company, you know that even the company culture is different, not speaking of the language.

Once open skies are common worldwide and the necessity to keep the Swiss cross or the Spanish flag on aircraft is no longer there, those problems will really start. So far, Swiss is not really integrated but an investment that participates and profits from the purchasing power of the parent.

Integration will become reality when the Swiss cross on the red tail will be replaced by yellow and blue.


Quoting Aerosol (Reply 47):
Unions vs. the German Occupier

wait till IB is really a part of LH. If that ever becomes reality, LH will certainly not be an "occupier". That kind of martial language should not be used.
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