MADRID (Reuters) - The board of Spanish low-cost airline Vueling VULG.MC on Tuesday unanimously recommended shareholders accept an improved takeover offer of 9.25 euros per share from International Airline Group (ICAG.L) (ICAG.MC).
IAG, which already owns 45.85 percent of Vueling as well as British Airways and Spanish airline Iberia, last month raised its bid by almost one third after the Barcelona-based carrier rejected a previous offer of 7 euros per share.
“The board of Vueling recommends shareholders to accept the improved offer for the following reasons: the price is reasonable and within the valuation issued by experts and from a strategic point of view the deeper integration of Vueling in IAG will offer advantages and opportunities,” Vueling said in a notice sent to the stock exchange regulator.
IAG, which is trying to lay off more than 3,000 workers and cut salaries at its Spanish airline Iberia to return the unit to profitability, could use Vueling to boost its short-haul business and compete with cheaper operators.
Vueling’s shares closed virtually flat at 9.26 euros on Tuesday while IAG shares closed up 1.83 percent at 2.79 euros.
Reporting by Julien Toyer; Editing by Sarah Morris and Helen Massy-Beresford