Low-cost airline Norwegian rejects two takeover bids from BA owner
Low-cost airline Norwegian rejects two takeover bids from the owners of British Airways
- The board of Norwegian said the takeover proposals ‘undervalued’ the airline
- BA owners International Airlines Group (IAG) wanted to make an offer for carrier
- It came after it recently acquired a 4.61 per cent stake in the low-cost airline
- Norwegian operates double daily flights between London Gatwick and New York
Low-cost airline Norwegian has rejected two takeover offers from the owners of British Airways.
The board of Norwegian (NAS) unanimously rejected the ‘conditional proposals’ saying that they ‘undervalued NAS and its prospects’.
In a statement, the carrier also added that the board ‘would remain fully committed to delivering on its stated strategy’.
Low-cost airline Norwegian has announced it has rejected two takeover offers from the owners of British Airways, International Airlines Group (IAG)
However, the news of the rejected takeover sent shares in the Oslo-listed company down eight per cent.
Last month, the owner of British Airways, International Airlines Group (IAG), announced that it had acquired a 4.61 per cent stake in Norwegian.
It added it was ‘intended to establish a position from which to initiate discussion’, including the possibility of a full offer for the firm.
But in an analyst presentation, IAG said it had so far failed to reach an agreement with the carrier.
In a statement IAG said: ‘IAG confirms that it has had contact with the Norwegian board regarding a possible offer, without reaching an agreement.
‘IAG is currently considering its options in relation to Norwegian.’
IAG reported a sharp increase in first quarter profit, helped in part by the timing of Easter.
It saw operating profit in the three months to March 31 rise 75 per cent to 280 million euro (£247 million), traditionally the weakest quarter of the year for airlines.
As well as owning British Airways, IAG also owns Irish carrier Aer Lingus and Spanish-based Iberia and Vueling
Revenue grew 2.1 per cent to five billion euro (£4.4 billion) as the group benefited from Easter falling within the reporting period.
IAG also said sales were boosted by service improvements, with a particularly strong showing in North America, Europe and Latin America.
Chief executive Willie Walsh said: ‘We’re reporting another strong quarter performance with an operating profit of 280 million euros before exceptional items, up from 160 million euros last year.
‘Our positive passenger unit revenue trend continued with an increase of 3.5 per cent at constant currency.
‘This trend benefited partially from the timing of Easter. Despite higher market prices, our fuel unit costs have gone up by just 0.6 per cent in euros.’
As well as British Airways, Irish carrier Aer Lingus and Iberia, IAG also owns Spanish low-cost airline Vueling and recently launched a budget long-haul operator dubbed Level.
Norwegian broke the record for the fastest subsonic transatlantic flight from New York to London, completing the journey in just five hours and nine minutes. Pictured is the entire crew who operated the flight on February 8
Meanwhile Norwegian, Europe’s third largest low-cost carrier, operates double daily flights between London and New York using the state-of-the-art Boeing 787 Dreamliner.
Earlier this year it broke its own record for the fastest subsonic transatlantic flight from New York to London, completing the journey in just five hours and nine minutes.
A Boeing 787-9 Dreamliner, registered as G-CJGI and captained by Gatwick-based Martin Wood, beat the record set in January by four minutes after reaching 799mph on the crossing.
The flight left JFK on Thursday, February 8, and was able to touch down at Gatwick airport around an hour ahead of time thanks to a ferocious jet stream.
However, the fastest ever transatlantic crossing by a passenger plane was in February 1996, when a British Airways Concorde flight from New York to London took just two hours, 52 minutes and 59 seconds.
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