Investors, including British Airways and American Airlines, have finalised accords for taking stakes in Iberia after agreeing a value for the airline with the Spanish Government, clearing the way for its privatisation. The deal, signed on 15 December, followed several months of negotiations between the core investors and state holding company SEPI.

Iberia's market value has been established at €2.73 billion ($2.73 billion), 21.6% less than the original value set by SEPI. The new value reflects 1999 profits, which are expected to be about half original estimates. The private shareholders will take a 40% stake in Iberia, with BA controlling 9% and American 1%.

BA wins the right to appoint two directors to Iberia's board, and has named Roger Maynard, its director of investments and joint ventures, and former UK foreign minister Lord Garel-Jones, now with investment bankers Warburg Dillon Read.

Institutional shareholders have also concluded agreements, with Caja Madrid, the BBV bank, Logistica, El Corte Ingles and Ahorro Corp together taking 30% and appointing four directors.

About 6% of Iberia is held by employees, and the remaining 54% will be floated next year. Spanish industry minister Josep Piqué says the stock market offering will not take place before legislative elections next March.

Source: Flight International