Turkish Airlines is considering taking a minority stake in Spain’s Air Europa, according to a report from Reuters on Friday.
Citing two unnamed sources with knowledge of the proceedings, the outlet said Air Europa has asked interested parties to submit their bids for a roughly 20% stake in the company by early July. Both Air France and Lufthansa have been in talks with Air Europa for months, meaning they will likely participate in the process, but up until this week, there was no sign that Turkish Airlines would also enter the bidding war.
Air Europa is looking to raise cash to pay back about $546 million in loans it borrowed from the Spanish government during the COVID-19 pandemic.
In March, Spanish newspaper El Confidencial reported that Air France offered $326 million and the assumption of all debt in exchange for 51% of Air Europa. Lufthansa was in talks to acquire a 20% stake, but it is not clear if it made an offer.
According to El Confidencial, discussions with Air France and Lufthansa stalled during the spring over disagreements about Air Europa’s valuation. The Hidalgo family, which owns Air Europa through its holding company Globalia, valued the carrier at about $1.3 billion, which neither Air France nor Lufthansa accepted.
International Airlines Group, the parent company of British Airways and Spanish carrier Iberia, attempted to buy all of Air Europa last year but backed out over scrutiny from regulators. IAG already owns 20% of the airline.
If Turkish Airlines were to succeed with its bid, the carrier would become one of the very few non-European companies to own a piece of a European airline.
Air Europa is the third-largest airline in Spain, behind Iberia and low-cost carrier Vueling.
