International Airlines Group

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International Consolidated Airlines Group, S.A.
Sociedad Anónima
Traded as LSEIAG
Founded 21 January 2011[1]
Founder British Airways and Iberia
Area served
Key people
  • Passenger air transport services
  • Air freight services
Revenue 20,170 million (2014)[2]
€1,390 million (2014)[2]
Profit €1,003 million (2014)[2]
Number of employees
59,484 (2014)[2]

International Consolidated Airlines Group, S.A., often shortened to IAG, is a Spanish-British multinational airline holding company based in London, England, UK and with its registered office in Madrid, Spain. It was formed in January 2011 by the merger of British Airways and Iberia, the flag carrier airlines of the United Kingdom and Spain respectively.[3][4] It is the sixth-largest airline company in the world and third-largest based in Europe measured by 2010 revenues.[5]


British Airways and Iberia signed a preliminary merger agreement in November 2009.[6][7][8] 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.[9][10] The merger between British Airways and Iberia was completed on 21 January 2011, and shares in IAG began trading in London and Madrid on 24 January.[11][12][13]

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.[14] 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.[15][16] Iberia Express began operations on 25 March 2012.[17][18]

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%.[19][20] On 22 December 2011, IAG agreed a binding deal with Lufthansa to acquire BMI for £172.5 million.[21] 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.[22]

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.[23][24] In December 2012, IAG completed the merger of the cargo operations of British Airways, BMI and Iberia into a single business unit, IAG Cargo.[25][26]

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.[27][28] The aircraft are planned to replace some of British Airway's fleet of Boeing 747s between 2017 and 2021.[27] On 16 October 2013, Iberia unveiled a new livery used from the end of November 2013.[29]

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.[30]

In Jan 2015, IAG made an bid of £1 bn. for Aer Lingus. This was expected to be accepted, after the rejection of two prior bids.[31] In May 2015, the Irish government agreed to sell its stake in Aer Lingus to IAG,[32] as did the Aer Lingus board in late January 2015.[33] The takeover became irreversible on the 18th of August. [34]

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).[35] In November, 2015 Alex Cruz was named Executive Chairman of British Airways. Steve Gunning was appointed chief financial officer of British Airways.[36]

Corporate affairs[edit]


IAG is incorporated in Spain as a Sociedad Anónima, its board meetings are held in Madrid and its tax domicile is in Spain.[37][38][39][40] IAG has a primary listing on the London Stock Exchange and has been a FTSE 100 constituent since 24 January 2011.[41] It has secondary listings on the Madrid, Barcelona, Bilbao and Valencia stock exchanges.[42] IAG has its operational headquarters, which controls the management of both its Spanish and British subsidiaries, at 2 World Business Centre on the property of London Heathrow Airport in the London Borough of Hillingdon.[43][44]

IAG has a primary listing on the London Stock Exchange and has been a FTSE 100 constituent since 24 January 2011.[41][45] It has secondary listings on the Madrid, Barcelona, Bilbao and Valencia stock exchanges,[42][46] and has been a constituent of the IBEX 35 index since 1 April 2011.[47]

Divisions, subsidiaries and franchises[edit]

Aer Lingus Airbus A330-200
British Airways Boeing 787-8

The structure of the main operating companies is:

Previous shareholdings[edit]

Major shareholders[edit]

Shareholder Holding[53]
Qatar Airways[54] 9.99%
Standard Life Investments Ltd 6.008%
Europacific Growth Fund 5.261%
Capital Research and Management Company 5.049%
BlackRock 3.565%
Legal and General Group plc 3.236%
Lansdowne Partners International Limited 2.191%
Invesco Ltd 1.082%
Lansdowne Developed Markets Master Fund Ltd 1.014%

Financial results[edit]

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


British Airways, Iberia, Vueling and Aer Lingus operate under their separate brand names.[55] As of 17 January 2014, IAG had a total of 464 aircraft with 150 aircraft on order and in excess of 110 options. The most popular type operated is the Airbus A320 series, with a combined fleet of 226 aircraft.[56] For details of the current aircraft operated by the group, see the fleet details for each of the main operating subsidiaries - British Airways, Iberia, Aer Lingus, and Vueling. The entire and serves around 200 destinations.[55][56] For a list of destinations, refer to the respective lists of destinations of different IAG subsidiaries.

Loyalty programme[edit]

IAG operates the Avios loyalty programme, which was renamed from Air Miles on 16 November 2011.[57] Avios points are the frequent flyer currency of British Airways, Iberia and Flybe, and can also be used for travel within the Oneworld alliance. 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, came into ownership of Avios Group Ltd.[58]


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  50. ^ "Shareholders Major AMADF Amadeus IT Holding SA including Fund and Institutional". 
  51. ^ "UPDATE 1-Iberia sells Amadeus stake to Nomura for 578 million euros". Reuters. 
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  56. ^ a b "Fleet/Product". International Airlines Group. 30 June 2012. Retrieved 17 Jan 2014. 
  57. ^ Patrick Burgoyne (2 September 2011). "AirMiles says adios, returns as Avios". Creative Review. 
  58. ^ "Helping Avios analyse huge data sets to boost transparency and growth". PwC. Retrieved 2015-12-09. 

External links[edit]