IAG Launches €350M Share Buyback, Qatar Airways Sells Stake
International Airlines Group (IAG) has announced a €350 million ($375 million) share buyback program starting November 11, 2024, aiming to repurchase up to 319,447,282 shares, representing 6.426% of its current share capital. As part of this buyback, Qatar Airways will sell shares worth €88 million ($94.3 million) to Goldman Sachs Bank Europe SE and Morgan Stanley Europe SE, who are administering the program on IAG’s behalf. IAG plans to complete the buyback by February 28, 2025, with shares being acquired from both the market and Qatar Airways.
According to a London Stock Exchange filing on November 8, the buyback consists of €262 million ($281 million) of equity purchased from the London and Spanish stock exchanges, while Qatar Airways’ stake in IAG will remain at 25.143% following the share buyback. The shares acquired in the buyback are subject to shareholder approval for cancellation, aligning with IAG’s long-term strategic focus on delivering sustainable shareholder returns.
IAG, a major British-Spanish airline holding company, owns several brands, including British Airways, Iberia, Vueling Airlines, LEVEL, Aer Lingus, IAG Loyalty, and IAG Cargo. The structure of the share buyback program allows Qatar Airways to sell shares daily to the banks, who will then match the number of shares purchased on the open market each day, with the transaction price pegged to the daily market volume-weighted average price.
The buyback coincides with IAG’s announcement of a robust 15% increase in Q3 2024 profits, which reached €2 billion ($2.14 billion), surpassing the projected €1.78 billion ($1.91 billion). IAG’s CEO, Luis Gallego, highlighted the group’s strength in the North Atlantic, South Atlantic, and intra-European markets, which have driven strong demand across its airlines. Although demand is high, IAG has deprioritized additional capacity in Asia, citing Russian airspace restrictions and competition from Chinese carriers as factors affecting growth in that region.
IAG’s decision to initiate a share buyback underscores the company’s confidence in its business model and long-term prospects. The company emphasized that the buyback aligns with its disciplined capital allocation framework, which supports its strategy to generate sustainable returns and increase shareholder value. The recent financial gains and buyback plan illustrate IAG’s commitment to growth within its primary markets while strategically managing capacity and competition.
With IAG’s continued focus on profitable routes and solid financial performance, this buyback program signifies a strategic move to enhance shareholder returns and reinforce confidence in the group’s future trajectory.
Related News : https://airguide.info/?s=IAG
Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com