Iberia, the Spanish airline long courted by a consortium led by British Airways and private-equity firm TPG, said it's received a rival takeover approach worth up to US$5.4 billion from a group of Spanish investors.
The Spanish consortium, called Gala Capital, is proposing an indicative offer in the range of $5.25 to $5.69 a share, compared with an indicative bid of $5.25 a share presented by British Airways and its partners earlier this year.
BA expects to make a formal offer for its Spanish competitor by the middle of December, but the emergence of a rival bidder could scupper its plans to pocket Europe's fourth-largest airline, in which it already has a 10 percent stake.
The consortium led by the British carrier and TPG, formerly known as Texas Pacific, also includes Spanish investors Vista Capital, Inversiones Ibersuizas and Quercus Equity.
The all-Spanish consortium that came forward includes Juan Jose Hidalgo, the chairman of Spanish privately-owned carrier Air Europa, and Basque savings bank BBK.
Analysts have said that the option to explore a bid in conjunction with private equity is a defensive move for BA and a sensible compromise as a full bid would have overstretched its balance sheet.
Iberia is an important partner for British Airways. Within Europe, the two airlines, which are members of the oneworld alliance, have crucial code-sharing on UK-to-Spain routes.
With a new aviation treaty between the US and Europe due to open up competition across the Atlantic next year, a wave of airline mergers could be on the horizon. BA likely wouldn't want Iberia to fall into the hands of a rival such as Deutsche Lufthansa.
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