IAG share price: Qatar Airways may consider hiking stake in group

Qatar Airways might consider hiking its stake in British Airways parent International Consolidated Airlines Group (LON:IAG) further, the Gulf carrier has said. The state-backed group revealed earlier this year that it had raised its holding in the FTSE 100 company, which also owns Iberia, Aer Lingus and Vueling, to over 15 percent.

The comments sent IAG’s share price soaring in yesterday’s session, with the stock closing 5.05 percent higher at 409.90p in London, outperforming the benchmark FTSE 100 index which inched 2.17 points lower to close 0.03 percent in the red at 6,680.69. The group’s shares have lost nearly 23 percent of their value over the past year, and are down by more than 32 percent in the year-to-date.

Qatar Airways said in a short statement to the London Stock Exchange yesterday that it currently held 15.67-percent shareholding in IAG and reiterated that it “may consider increasing its stake further within the allowable limits”. The Gulf airline, which first acquired a 9.99-percent stake in the British Airways parent in January last year, is limited to owning less than 50 percent of IAG under EU rules which prevent non-European shareholders from controlling EU airlines.

The Times noted in its coverage of the news that Qatar Airways’ statement had followed comments by the airline’s chief executive Akbar Al Baker at the Farnborough air show earlier this week where he was said to have ruled out increasing the carrier’s holding, despite the fall in IAG’s share price. The British Airways parent issued a warning immediately following the EU referendum, cautioning that the Brexit vote would weigh on its profit growth this year.
Qatar Airways’ move to hike its holding in the FTSE 100 group has prompted concerns about the Gulf state’s grip on British aviation, with Qatar Holding, part of the country’s sovereign wealth fund, holding a 20-percent stake in Heathrow.
As of 08:06 BST, Wednesday, 13 July, International Consolidated Airlines Grp share price is 409.90p.