Spanish industry minister Josep Pique has delayed the privatisation of Iberia until the first quarter of next year, at the earliest, in the face of uncertainty in the international financial markets and a fall in the flag carrier's projected year-end profits.

SEPI, the institution controlling Madrid's 53.9% stake in Iberia, says the delay follows a report by a committee of 45 domestic and international financial bodies which found insufficient "financial technical criteria" to allow the privatisation to go ahead as planned this month. "The committee found that the international stock market was not in a good enough position to take up the offer at present," it says.

Iberia has performed well in the past three years, but anticipates a 53% drop in profits at year end, to c150.25 million ($156 million). The "core group" of private investors in Iberia, which include British Airways, with 9.3%, and the Cajamadrid bank, with 10%, is also said to have queried the valuation of the airline - put at c3.5 billion - and to have asked Madrid to reduce the share price when an initial public offering finally takes place.

The UK flag carrier is also concerned about government plans to retain a say in strategic decisions at Iberia for an unspecified time - possibly 10 years - after privatisation. Although its entire stake is to be sold, Madrid's golden share will allow it to block any transfer of more than 25% of the airline's capital to another buyer, or any sell-off of major assets.

Source: Flight International