Brexit and British Airways, easyJet, Ryanair, et al.

[sean1982]

BA is not a shareholder. BA is completly owned by IAG which is a european company.

[Stij]

BA is not a shareholder. BA is completely owned by IAG which is a European company.

But who owns those shares? If they're controlled by more tan 50% from outside the EU... they're in deep trouble...

Stij

[sean1982]

Its a public company with it's registered offices in Spain.

https://en.wikipedia.org/wiki/Internati ... ines_Group

[Passenger]

Just like Brussels Airlines will remain a Belgian airline once Lufthansa takes over full control, British Airways is a British airline. No matter where IAG has its head office.

https://www.britishairways.com/en-be/in ... ead-office

[quixoticguide]

BA is not a shareholder. BA is completely owned by IAG which is a European company.

But who owns those shares? If they're controlled by more tan 50% from outside the EU... they're in deep trouble...

Stij

15,01% Qatar Airways

[sean1982]

Just like Brussels Airlines will remain a Belgian airline once Lufthansa takes over full control, British Airways is a British airline. No matter where IAG has its head office.

https://www.britishairways.com/en-be/in ... ead-office

the company is british within an independant UK. that's not an issue at all

[Inquirer]

I am sure IAG has a core group of registered share holders so as to keep track of their nationality and thus prove they are a genuine EU company by at least 50% all the time.
That's how it is done everywhere.

Now, if indeed it turns out 50%+1 of those EU shareholders are indeed British companies/persons, then IAG as a whole will lose their EU rights, or alternatively have to ask (some of) those British share holders to sell (part of) their shares in order to make IAG requalify as an EU company.

And then it can only hope that the British government will continue to allow foreign holding of it's flag carrier, otherwise it will have to decide which market is most important to it, or go for a corporate break up as well.

Provided the rules aren't changed of course, because as said before: nobody really knows how this has to be done, even the Brexiteers now say they are not in a hurry and nothing needn't change before 2020, so who knows: we're getting fast forwarded into legal science fiction by the results of yesterday's referendum.

[quixoticguide]

-20% today IAG share in LON
-24% today IAG share in MAD
http://www.iagshares.com/phoenix.zhtml? ... calculator

[jan_olieslagers]

That's how shares go. Nothing to worry about. Remember the chemical explosion in Bhopal, India, a couple of decades ago? The Union Carbide shares plummeted, then, quite dramatically; after only a couple of months, the value had completely recovered.

[Poiu]

If I remember well, A foreign shareholder can only hold 49% of a EU based airline. So unless some sort of agreement is made on that issue, BA will have to let go of at least some shares of their holdings in Vueling an Iberia and officially hand the control to an EU based companion. So they will have to go through some big changes for shore.

I could be wrong, but IAG has to be seen as a holding company.
Iberia, Vueling, BA,... are all daughters, transfer from one to another should be relatively simple.
The have AOCS on both sides of the future EU border.

[flightlover]

If I remember well, A foreign shareholder can only hold 49% of a EU based airline. So unless some sort of agreement is made on that issue, BA will have to let go of at least some shares of their holdings in Vueling an Iberia and officially hand the control to an EU based companion. So they will have to go through some big changes for shore.

I could be wrong, but IAG has to be seen as a holding company.
Iberia, Vueling, BA,... are all daughters, transfer from one to another should be relatively simple.
The have AOCS on both sides of the future EU border.

But they will still have to comply with the 50%+1 in shares held by either nationality of where the airline is located.

[Conti764]

Slightly off topic, but I hate to see how Belgium is sitting idle once again while Frankfurt, Paris and Dublin are ready to welcome bankers from Lonfon...

[Jetter]

If I remember well, A foreign shareholder can only hold 49% of a EU based airline. So unless some sort of agreement is made on that issue, BA will have to let go of at least some shares of their holdings in Vueling an Iberia and officially hand the control to an EU based companion. So they will have to go through some big changes for shore.

Well, you remembered the rule well but are mistaken about BA ownership IAG owns BA and is a Spanish company. So if anything has to change depends on the rules an independent Britain instates.

[Poiu]

That's how shares go. Nothing to worry about. Remember the chemical explosion in Bhopal, India, a couple of decades ago? The Union Carbide shares plummeted, then, quite dramatically; after only a couple of months, the value had completely recovered.

I followed your advise Jan and bought IAG shares for the best part of my last month's salary.

[sean1982]

If I remember well, A foreign shareholder can only hold 49% of a EU based airline. So unless some sort of agreement is made on that issue, BA will have to let go of at least some shares of their holdings in Vueling an Iberia and officially hand the control to an EU based companion. So they will have to go through some big changes for shore.

Well, you remembered the rule well but are mistaken about BA ownership IAG owns BA and is a Spanish company. So if anything has to change depends on the rules an independent Britain instates.

like i said indeed

[jan_olieslagers]

That's how shares go. Nothing to worry about. Remember the chemical explosion in Bhopal, India, a couple of decades ago? The Union Carbide shares plummeted, then, quite dramatically; after only a couple of months, the value had completely recovered.

I followed your advise Jan and bought IAG shares for the best part of my last month's salary.

Mind you, @Poiu, I did NOT recommend or advise anything whatsoever; except consulting history. But you can always offer me a beer, if ever you do realise a profit

[RoMax]

Do you think the EU will grant membership of ECAA just like that? It will come with all the strings attached which made the UK vote for a Brexit. Traffic between EU and UK probably yes but G planes operating between EU cities?? EasyJet will be the biggest victim as the half half of their fleet is based out of the UK operated by EU nationals.
The agreement with the Swiss is very strict, it is part of a, quite strict, seven agreements package deal. (labour, immigration, money,..).

There are several non-EU countries that are full members of ECAA that have the same reasons on why not to be part of the EU as the UK (not completely similar, but there are many things in common). Of course there are very strict and important conditions to be part of ECAA and it's no surprise that already today easyJet has sent a letter to the British Government and the European Commission etc. to start negotiations on remaining part of ECAA immediately. But is it in the benefit of the EU to play the 'hard-to-get' game with the UK in terms of the common aviation market? Protectionism would be the only reason and even then...what's the benefit. EasyJet will just launch an EU daughter owned 49% by the current British company (just like easyJet Switserland in which they own just 49%). They have already done their homework on how to do that in the case of UK leaving the EU and them not being able to remain a member of ECAA.

[LJ]

There are several non-EU countries that are full members of ECAA that have the same reasons on why not to be part of the EU as the UK (not completely similar, but there are many things in common).

Yet they're either EEA or are planning to become EU member (Kosovo, Montenegro, Serbia, Macedonia and Bosnia) and thus have a very extensive agreement wih the EU and thus they (or are planning to) accept EU regulation without any influence. Thus unlike the UK they do want the EU, which the UK doesn't want.

[RoMax]

Yet they're either EEA or are planning to become EU member (Kosovo, Montenegro, Serbia, Macedonia and Bosnia) and thus have a very extensive agreement wih the EU and thus they (or are planning to) accept EU regulation without any influence. Thus unlike the UK they do want the EU, which the UK doesn't want.

Norway, Iceland (not anymore) or Switserland don't want the EU either (the only reasons they work together on some levels are economic, why would that be different for the UK), yet the first two are part of ECAA and the third has another far-reaching agreement. Indeed this all goes way beyond just having an agreement on a single aviation market. But don't exagerate the decision of the UK, they don't want to be full member of EU, but do people really think they will abolish every sort of agreement that exists between EU and non-EU members? I don't think so...a big part of the UK might have proven to be stupid, they can't be that stupid.

But again, even if they don't get full access to ECAA in the sense of UK carriers having unlimited access to operate flights between EU destinations (which I see as the only possible major issue), a carrier like easyJet (the only one being heavily affected by this) will just launch a sort of easyJet Europe like they have easyJet Switserland (being a minority owned subsidiary, but basically fully controled by easyJet).

I really don't see such a huge impact on this level, although there is of course a lot of uncertainty. I rather see an (indirect) impact from an economic perspective.

[Passenger]

It’s the damned right of the British voters to have voted for a Brexit. Belgian politician Mark Eyskens once said after he had lost an election: “the voters are always right, even when they are wrong”. The British people have voted for a Brexit, so the EU has to accept that. If someone has to be blamed, is the remain camp: for not having convinced the electorate, for not having invented a strong counter-word against “Brexit”.

Now, regarding the ongoing discussion here. Before election day, the European Union has warned “out is out”. It was a firm statement: a no is a no, and not “except for agriculture” or “except for aviation”. So I disagree with those who think that the European Union is willing to allow British airlines to continue like they do now. If the EU gives in on one subject, other EU-members will also vote an Exit. Out is out. All preferential treatments as EU-members will be lifted by 2018 or 2010. British Airways, Virgin, EasyJet and others will have to negociate new traffic rights with the EU. And they have to do so as beggers: Europe doens’t need their traffic: they need our traffic. They need our tourists. They need business links for their economy.

Same for the UK-carriers who, today, operate between two countries of the European Union. Why would Spain and Belgium allow a non-EU carrier to fly between Brussels and Barcelona? When Spain and Belgium mutually agree that there are already enough flights, the UK-carrier has a problem. Freedom of transport? The right to move? Yes, but that’s internal EU-legislation. There is a general Freedom of trade, but international aviation legislation allows limitation.

Tuffer negociations will have to be done by the British airlines who, today, fly from a EU-country to another EU-country. Airlines like Easyjet will have to accept the conditions that both departure and arrival countries will implement. Set up a base somewhere in Europe, as some suggest? Remain/become member of the European Common Aviation Area? Sure, but that won't be given unconditionally, as the EU has warned the U.K. before the Brexit vote.

(edited : "Ryanair" deleted twice in above text)