British Airways Owner IAG Faces Fight for Control of Norwegian

Norwegian Air

by Bradley Gerrard, The Telegraph, April 26, 2018

British Airways owner IAG is likely to face a bidding war if it wants to take control of low-cost long-haul carrier Norwegian after its boss Bjorn Kos revealed “various” airlines were circling.

Willie Walsh’s airline group, which also owns Iberia and Aer Lingus, revealed earlier this month it had built a near 5pc stake in its rival and a position that it claimed could lead to a bid for the entire airline.

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Norwegian has established a dominant position in low-cost flights to far-flung destinations in the US, South America and Asia and has become a thorn in the side for so-called legacy carriers such as British Airways, which struggle to compete on the same terms.

Mr Kos told Bloomberg News he could not reveal who the other interested parties were but confirmed they were all industry rivals.

“So far it is airline groups but I cannot say who they are,” Mr Kos said. “They are taking a lot of interest in Norwegian.”

The potential purchase of the airline comes amid a flurry of recent activity in the aviation industry. The collapse of Air Berlin saw the carrier snapped up by easyJet and Lufthansa. EasyJet is also in contention to buy parts of Alitalia.

Ryanair also recently bought a stake in former Formula 1 world champion Niki Lauda’s LaudaMotion, the owner of low-cost airline Niki.

The comments from Mr Kos came as his airline released its results for the first three months of 2018. Pre-tax losses narrowed to NOK 515m (£46.4m) compared to a NOK 1.8bn loss in the same period the prior year thanks to revenues rocketing a third to nearly NOK 7bn.

Its costs including fuel dropped 2pc thanks to the strength of the Norwegian krone versus the dollar but on a constant currency basis rose by 2pc.

The company said the spot price for jet fuel had risen 26pc in the past year to roughly $700 per tonne but there were signs prices could start to drop marginally in the coming months.

 

This article was written by Bradley Gerrard from The Telegraph and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to [email protected].

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