Britain’s Competition and Markets Authority (CMA) is set to
investigate the proposed sale of Spanish airline Air Europa to British Airways
owner International Airlines Group (IAG) over fears the deal might harm airline
competition in the UK.
IAG announced plans for its own Spanish carrier Iberia to
buy Air Europa for €1 billion in 2019. The price of the sale was reduced to €500
million earlier this year after the Covid-19 pandemic impacted global airline
revenue.
The agreement is already being probed by the European
Commission over worries that it would reduce competition on Spanish domestic
and international routes. IAG said it has offered concessions to address the EU’s
concerns but has not released details on what those compromises are.
The UK’s CMA has set a deadline of 19 January 2022 to
announce the findings of its investigation. IAG has said in a statement that it
will “collaborate” with the watchdog and that it believes the route between
London and Madrid is “highly competitive and is already part of the European
Commission [investigation] process”.