Aer Lingus parent IAG considering asset disposals to raise cash

Airline group working with advisers on a strategic review of its portfolio

Aer Lingus’s parent company, IAG, is considering ways of raising cash while global travel remains subdued, including possible asset disposals, according to people familiar with the matter.

The news comes as the airline group prepares to announce full year results for 2021 before markets open on Friday.

The group is working with advisers on a strategic review of its portfolio that could lead to stake sales, partnerships and joint ventures, the people said.

Potential assets that could theoretically be used to raise funds include planes, IAG’s frequent-flier programme and its cargo unit.

Any sales could help bolster the company’s balance sheet and would likely draw other industry players and investment funds, according to the people, who asked not to be identified discussing confidential information.

Deliberations are at an early stage, no final decision has been made and IAG could still decide against any disposals or partnerships, the people said.

Representatives for IAG and Aer Lingus declined to comment.

The group's other airlines include British Airways, Iberia, Level and Vueling.

Its mileage programme IAG Loyalty counts more than 35 million members globally. IAG also manages IAG Cargo, which operates a global air freight network, and IAG Global Business Services, which is an IT, procurement and financial support platform.

With a fleet of about 533 aircraft, the company operates routes to 279 destinations and carried about 118 million passengers a year before the pandemic started, according to its website.

Pandemic fallout

Global airlines have been hit hard by two years of travel curbs due to the Covid-19 pandemic. While British Airways has seen a recent sales boost from the lifting of some restrictions, long-haul travel remains subdued with high infection rates of the Omicron variant globally.

IAG shares have climbed 2.5 per cent in London this year, valuing the company at about £7.2 billion (€8.6 billion).

Other airlines are exploring ways to maximise the value of their portfolios of assets, including United Airlines, which is considering a potential sale of a minority stake in its frequent-flier programme MileagePlus, Bloomberg News has reported. – Bloomberg

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