The Air France-KLM Group has reportedly made a €300 million offer to acquire a controlling stake in the indebted Spanish airline, Air Europa.
This proposal puts the Franco-Dutch airline group in direct competition with Germany’s Lufthansa Group, which had previously been viewed as the leading candidate to secure control of the airline.
According to the Spain’s online El Confidencial, Air France-KLM has offered to pay €300 million in cash to the Hidalgo family in return for a 51% stake in the airline. The Hidalgo family, through their Globalia travel group, currently holds the largest share of Air Europa.
In addition to the cash offer, Air France-KLM is reportedly prepared to take on Air Europa’s outstanding debts owed to the Spanish government. These debts stem from emergency loans provided during the Covid-19 pandemic to help the airline survive.
Air Europa had been experiencing financial difficulties even before the pandemic, which were further aggravated when a proposed acquisition by the International Airlines Group (IAG) fell through in August 2024. IAG, which owns British Airways and Iberia, abandoned the deal following a ruling by EU competition authorities that deemed the merger anti-competitive.
After the collapse of the IAG deal, Lufthansa had emerged as the frontrunner with a reported offer of €240 million in the Spanish company via a capital increase of 25%, and which would allow it to pay off debt contracted with the state.
The German airline group has been aggressively expanding its holdings in Europe, already owning majority stakes in Lufthansa, SWISS, Brussels Airlines, ITA Airways, Discover Airlines, Austrian Airlines, and several regional carriers. Lufthansa has also expressed interest in acquiring a stake in TAP Air Portugal once that airline is put up for sale.
Despite existing ties between Lufthansa and Air Europa – such as a Boeing 787-9 leased by Air Europa to Lufthansa’s Austrian Airlines – El Confidencial reported that the Hidalgo family is divided on whether to accept the bid from Air France-KLM or Lufthansa.
Key considerations for the family are likely to include how each bidder plans to improve Air Europa’s operations. Analysts believe the airline is currently underperforming and struggling to compete with Spain’s national carrier, Iberia. Additional concerns may include securing the airline’s financial future and evaluating potential partnership opportunities with new investors.
Speaking earlier in March 2025 about the Air France-KLM Group’s 2024 financial results, Chief Executive Benjamin Smith acknowledged the group’s interest in acquiring a stake in Air Europa. This interest follows Air France-KLM’s recent purchase of a 19.9% stake in Scandinavian airline SAS.
According to Planespotters.net, Air Europa’s current fleet consists of 26 Boeing 737-800s, seven Boeing 787-8 Dreamliners, and 15 Boeing 787-9s, with an average aircraft age of 9.1 years. In 2024, the airline carried 12 million passengers across Europe, Latin America, and the Caribbean.
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