Turkish Airlines (TK, Istanbul Airport) is closing in on a potential investment in troubled Spanish carrier Air Europa (UX, Palma de Mallorca), according to a report by online newspaper El Español. Meanwhile, Air France-KLM is out of the picture, while Lufthansa Group continues talks with Air Europa’s parent Globalia about buying a stake, Reuters reported.
El Español reported that Turkish Airlines is the frontrunner to become a shareholder in Air Europa, which is currently owned by Globalia (80%) and IAG International Airlines Group (20%). Both parties have been accelerating their negotiations in the last few days, and while many details remain on the table, an agreement could be imminent.
Separately, Lufthansa’s chief executive Carsten Spohr confirmed to Reuters that the company is in ongoing talks for a potential share acquisition in Air Europa. However, “I cannot yet give an answer whether it will fail or not. I can confirm that it is very difficult to get this to succeed,” he said.
El Confidencial reported that Lufthansa and Turkish Airlines are eyeing a 25% acquisition in Air Europa, providing the Spanish carrier with EUR240 million euros (USD275 million) in fresh capital.
In a statement to ch-aviation, Air France-KLM confirmed it has pulled out of the process. It is the second interested party to abandon negotiations after Etihad Airways did the same earlier in the year. It said: "Air France-KLM stepped out from the process initiated for the sale of a stake in Air Europa as no agreement could be reached with Globalia. The cooperation between Air France-KLM and Air Europa, a member of Skyteam, remains unchanged."
Meanwhile, both the German and the Franco-Dutch groups are simultaneously involved in the potential acquisition of a stake in a Portuguese state-owned TAP Air Portugal.
ch-aviation reached out to Turkish Airlines and Lufthansa Group for comment but neither was immediately available. Air Europa declined to comment.
Air Europa seeking loan
Separately, Air Europa expects to close the year with record results and is currently negotiating with banks to obtain a new loan providing fresh capital of about EUR140 million (USD160 million). El Confidencial reported that it is negotiating with Santander, BBVA, Caixabank, and Sabadell to obtain a new credit line for this amount.
Air Europa must repay the EUR475 million (USD550 million) loan that Spain's sovereign wealth fund (Sociedad Estatal de Participaciones Industriales - SEPI) provided to the carrier at the height of the COVID-19 pandemic.
