International Airlines Group

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International Consolidated Airlines Group, S.A.
Sociedad Anonima
Traded asBMADIAG
FTSE 100 Component
ISINES0177542018 Edit this on Wikidata
PredecessorBritish Airways and Iberia
Founded21 January 2011; 9 years ago (21 January 2011)[1]
  • Madrid (Registered office)
  • London (Head office)[2]
Area served
Key people
Revenue€24.406 billion (2018)[3]
€3,230 billion (2018)[3]
€2,897 billion (2018)[3]
Number of employees
64,734 (2018)[3]

International Consolidated Airlines Group, S.A., often shortened to IAG, is an Anglo-Spanish multinational airline holding company with its registered office in Madrid, Spain and its operational headquarters in London, UK. It was formed in January 2011 after a merger agreement between British Airways and Iberia, the flag carriers of the UK and Spain, respectively. As British Airways was the larger company, those holding shares in British Airways at the time of the merger were given 55% of the shares in the new, merged company. British Airways and Iberia ceased to be independent companies and instead became 100% owned subsidiaries of IAG.[4][5][6][7] It is the sixth-largest airline company in the world, producing €24.406 billion revenue in 2018.[3] The company is listed on the London Stock Exchange and the Madrid Stock Exchange. It is a constituent of the FTSE 100 Index and IBEX 35 Index.


Iberia and British Airways aircraft tails

British Airways and Iberia signed a preliminary merger agreement in November 2009.[8][9][10] In April 2010, British Airways and Iberia signed a full merger agreement, with an intended completion date of late 2010, subject to securing the necessary regulatory approvals.[11][12] The merger between British Airways and Iberia was completed on 21 January 2011, and shares in the new holding company IAG and began trading in London and Madrid on 24 January.[13][14][15]

In March 2011, IAG agreed to purchase eight Airbus A330-300 aircraft and to take options on eight more, to be used for Iberia's longhaul fleet.[16] On 6 October 2011, IAG created Iberia Express, a new low-cost airline to operate short- and medium-haul routes from IAG's Madrid hub and provide transfer feed onto Iberia's longhaul network.[17][18] Iberia Express began operations on 25 March 2012.[19][20]

On 4 November 2011, IAG agreed in principle to acquire British Midland International (BMI) from Lufthansa for an undisclosed sum, in a deal which would increase IAG's share of slots at Heathrow airport from 45% to 54%.[21][22] On 22 December 2011, IAG agreed a binding deal with Lufthansa to acquire BMI for £172.5 million.[23] On 30 March 2012, the purchase of BMI was approved, subject to the condition that the combined group divest itself of 12 daily slots and lease two daily slots at Heathrow airport. The acquisition was completed on 20 April 2012, and the BMI fleet and routes were integrated into the British Airways schedule throughout 2012.[24]

On 8 November 2012 International Consolidated Airlines Group (IAG) made a cash tender offer to buy Vueling, the Spanish low-cost airline based in Barcelona. The offer, was €7 per ordinary share of Vueling with the total cost of acquiring the shares anticipated to be €113m. It was funded from internal IAG resources. The reported total assets of Vueling as of 30 September 2012 were €805m and in the nine months to 30 September 2012 it generated profits before tax of €59m. An increased offer of €9.25 was accepted by the Vueling board on 9 April 2013 and received majority shareholder approval on 23 April 2013. IAG took control of Vueling on 26 April 2013.[25][26] In December 2012, IAG completed the merger of the cargo operations of British Airways, BMI and Iberia into a single business unit, IAG Cargo.[27][28]

In April 2013, IAG confirmed the conversion of options to acquire 18 Boeing 787 Dreamliners into firm orders, in a deal worth around US$4.5 billion.[29][30] The aircraft are planned to replace some of the British Airways fleet of Boeing 747s between 2017 and 2021.[29] On 16 October 2013, Iberia unveiled a new livery used from the end of November 2013.[31]

At the Farnborough Airshow 2014, IAG converted the options for 20 Airbus A320neo aircraft into firm orders which are currently intended to replace 21 shorthaul British Airways aircraft.[32]

In January 2015, IAG made a bid of €1.36 billion for Aer Lingus. This was expected to be accepted, after the rejection of two prior bids.[33] In May 2015, the Irish government agreed to sell its stake in Aer Lingus to IAG,[34] as did the Aer Lingus board in late January 2015.[35] The takeover became irreversible on 18 August 2015.[36]

On 1 March 2015 Stephen Kavanagh was appointed Chief Executive Officer of Aer Lingus, and executive director of the Aer Lingus Board. In October 2015 Rachel Izzard was appointed chief financial officer of Aer Lingus, and also appointed to the Aer Lingus Board of Directors (prior to joining Aer Lingus, Rachel Izzard was Chief Financial Officer at IAG Cargo).[37] In November 2015 Álex Cruz was named Executive Chairman of British Airways. Steve Gunning was appointed chief financial officer of British Airways.[38]

In April 2016, it was announced that Qatar Airways increased its shareholding of IAG from 9.99% to close to 12%.[39] In May 2016, Qatar Airways increased its shareholding to 15.01%.[40] On 29 July 2016, Qatar Airways increased its share to 20.01%.[41]

In March 2017 it was announced that a new low cost longhaul airline named LEVEL was to start operating from Barcelona in June 2017.[42]

On 29 December 2017, it was announced that IAG bought major parts of defunct Austrian leisure airline Niki including 15 Airbus A321 aircraft and traffic rights in Düsseldorf, Munich, Vienna, Zürich and Palma de Mallorca.[43] It is planned to establish a new Austrian subsidiary of Vueling as a replacement for Niki.[43]

In April 2018, it was reported that IAG was considering a takeover of Norwegian, a low-budget competitor to the group,[44] however by early 2019 IAG had fully disposed of its stake in Norwegian.[45]

In June 2019, IAG signed a letter of intent to purchase 200 Boeing 737 MAX aircraft even though at the time of the signing the 737 MAX is still grounded worldwide following the two fatal crashes likely caused by the design of the MCAS system.[46] Aviation analysts have questioned IAG's leadership in making such an order when the 737 MAX design is still being rectified. IAG CEO Willie Walsh, shrugged off the plane's uncertain future. "We’re partnering with the Boeing brand", he said. "That’s the brand that I’m doing business with. That’s the brand that I’ve worked with for years. And it’s a brand that I trust".[47] Observers suggest that IAG received a large discount on the purchase.

At the 2019 Paris Air Show IAG also agreed to purchase 14 Airbus A321XLR aircraft, 8 for delivery to Iberia and 6 to Aer Lingus, with options for a further 14 of the aircraft.[48]

In November 2019, IAG announced that it planned to acquire Air Europa from Globalia, for €1 billion. The deal, funded by external debt, is expected to be completed in the second half of 2020, subject to regulatory approval. [49][50]

On February 19 2020 Qatar Airlines revealed that it had increased its holding in IAG to 25.1% after purchasing another $600m.[51]

Corporate affairs[edit]


IAG's operational headquarters, which controls the management of both its British and Spanish subsidiaries, are at the Waterside building in Harmondsworth, London.[52] IAG is incorporated in Spain as a Sociedad Anónima, where the company board meetings are held, and is domiciled in Spain for tax purposes.[53][54][55][56] IAG has a primary listing on the London Stock Exchange and has been a FTSE 100 constituent since 24 January 2011.[57][58] It has secondary listings on the Madrid, Barcelona, Bilbao and Valencia stock exchanges,[59][60] and has been a constituent of the IBEX 35 index since 1 April 2011.[61]

Qatar Airways is a minority shareholder, and held 21.426% of the shares on 29 November 2018.[41]

Divisions, subsidiaries and franchises[edit]

The structure of the main operating companies is:

Financial results[edit]

Financial results have been as follows:[3]

Year Ended Passengers Flown Turnover (€m) Profit/Loss Before Tax (€m) Net Profit/Loss (€m) Basic EPS (€ cents)
31 December 2011 51,687,000 16,339 527 485 31.1
31 December 2012 54,600,000 18,117 (997) (923) (51.0)
31 December 2013 67,224,000 18,675 227 147 6.6
31 December 2014 77,334,000 20,170 828 1,003 48.2
31 December 2015 88,333,000 20,350 1,801 1,516 73.5
31 December 2016 100,675,000 22,567 2,362 1,952 93.0
31 December 2017 104,829,000 22,972 2,493 2,009 95.8
31 December 2018 112,920,000 24,406 3,487 2,897 142.7

By 2012, it was reported that British Airways profits had been wiped out by Iberia losses, placing the Spanish airline in a fight for its survival. IAG workers in Madrid reported they believed Iberia to be the 'junior partner' in IAG citing deep concern for the airline.[64]

By 2013, Iberia had lost a billion euros leaving IAG chief executive, Willie Walsh to defend the British Airways-Iberia merger.[65] In May of the same year, Iberia had suffered further losses and IAG's balance sheet was now in deep deficit as Iberia fought low-cost competition and a deep recession. Willie Walsh admitted that perhaps British Airways should have postponed the IAG merger, saying, "If I'd known the Spanish economy was going to deteriorate to the scale that it did, we may have delayed the decision but ultimately I believe the merger is the right thing".[66]

From 2014 on, the Iberia unit of IAG returned to profitability, confirming Walsh's predictions.[67]


British Airways, Iberia, Aer Lingus, Vueling and LEVEL operate under their separate brand names.[68] As of 31 December 2018, IAG had a total of 573 aircraft.[69] The most popular type operated is the Airbus A320 series, with a combined fleet of 227 aircraft.[70] For details of the current aircraft operated by the group, see the fleet details for each of the main operating subsidiaries - Iberia, British Airways, Aer Lingus, and Vueling. The entire company serves around 200 destinations.[68][70]

Loyalty program[edit]

IAG operates the Avios frequent-flyer programme, which was created from the merger of the Air Miles, BA Miles, and Iberia Plus Points schemes on 16 November 2011.[71] Avios points are the frequent flyer currency of Aer Lingus, Air Italy, British Airways, Flybe, Iberia, and LEVEL,[72] and can also be used for travel within the Oneworld alliance including the likes of Vueling, LATAM, Finnair etc.[73] A restructure in 2015 meant that all of IAG's affiliated loyalty programmes which use Avios, including Avios Travel Reward Programme, British Airways Executive Club, and Iberia Plus, were transferred to Avios Group, an IAG subsidiary.[63][74] Members of the British Airways Executive Club were able to freely move points between their British Airways account and It was announced in July 2018, that would close to British Airways Executive Club members with all points automatically transferred to British Airways.[75] will continue to operate for Iberia Plus and Aer Lingus members.


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External links[edit]