The administrator of Niki plans to press ahead with an agreed sale to International Consolidated Airlines Group (LON:IAG), Reuters has reported. The British Airways and Iberia owner announced plans to buy the insolvent Austrian airline earlier this year, but is facing a potential hurdle with a passenger rights group seeking to recover more than €1 million.
IAG’s share price has been little changed in London in today’s session, having added 0.03 percent to 663.00p as of 14:53 GMT. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.29 percent higher at 7,718.90 points. The group’s shares have added just under 42 percent to their value over the past year, as compared with a near-seven percent rise in the Footsie.
Niki deal update
Reuters reported today that Lucas Floether, the administrator of Niki, had said that he would press ahead with the airline’s sale to IAG, even after a German court ruling fanned concerns that the deal could unravel. Floether explained that a secondary insolvency filing in Austria, which Niki will submit by the end of this week, will safeguard the sale.
The Austrian carrier filed for insolvency in Berlin last month, and subsequently, IAG agreed to buy the business and make it part of its low-cost Spanish carrier Vueling. Fairplane, a group representing airline passengers, however, filed legal cases last week to have Niki’s insolvency proceedings shifted to Austria. A regional court in Berlin backed the passenger group’s position this week, noting that it would reverse the opening of insolvency proceedings in Berlin. Niki has filed an appeal against the ruling with Germany’s supreme court.
Analysts on IAG
Liberum remains bullish on the British Airways parent, having reiterated its ‘buy’ rating on the stock last week, valuing the shares at 875p. According to MarketBeat, the blue-chip company currently has a consensus ‘buy’ rating and an average price target of 551.64p.