Norwegian Air Says Two IAG Takeover Offers Undervalued Company

Norwegian Air Says Two IAG Takeover Offers Undervalued Company

IAG, which confirmed its position as one of Europe's strongest airline groups on Friday with a 75 per cent jump in quarterly profit, said it had held talks but could not reach an agreement with low-priced carrier Norwegian on a deal. Irish unit Aer Lingus is also doing well, he said.

International Consolidated Airlines Group S.A. (IAG.L, BAIRY.PK, BAY.L) reported Friday that its first-quarter profit before tax surged to 885 million euros from last year's 74 million euros. The British Airways parent disclosed that it had benefitted from favourable currency movements of €58 million, which helped offset higher fuel unit costs.

"This trend benefitted partially from the timing of Easter".

"But we think the really impressive part of these results is the group's tighter grip on controllable costs".

IAG expects operating profit for 2018 to show an improvement year-on-year.

Last month, IAG revealed that it is exploring a potential acquisition of low-priced carrier Norwegian Air Shuttle.

As of 09:48 BST, IAG's share price had added 4.46 percent to 669.20p, outperforming the broader London market, with the benchmark FTSE 100 index which now stands 0.39 percent higher at 7,532.21 points.

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Norwegian believes the IAG offers undervalue the airline and its prospects.

He says judging a business on its quarterly performance is unhelpful and stresses full year guidance depends on stable exchange rates and fuel costs throughout the rest of 2018.

'IAG is now considering its options in relation to Norwegian'.

On Thursday, IAG's majority shareholder Middle East carrier Qatar Airways said it would be supportive of a deal.

"The Board of Norwegian Air Shuttle (NAS) confirms that it has received two separate conditional proposals from IAG Group in relation to an acquisition of 100 percent of the share capital of NAS". The airline has recently made moves the discount flights arena which has forced larger competitors to respond.

Financial news service TDN Direkte reported that Willie Walsh, chief executive of IAG, told an analyst that while contact with the board of Norwegian Air didn't lead to any negotiations, "we are not actively looking" at other potential takeover targets.

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