Air France-KLM Pulls Out of Air Europa Deal Amid Consolidation Race

Talks Break Down with Globalia as European Airlines Jockey for Strategic Growth

Air France-KLM has exited talks to acquire a stake in Spanish airline Air Europa. Globalia, the current owner, and Air France-KLM failed to reach an agreement. Industry insiders point to governance disputes and valuation concerns as reasons for the breakdown. The withdrawal ends months of speculation around a potential Franco-Spanish alliance.

Lufthansa and Turkish Airlines Remain in the Running for Air Europa

Lufthansa’s CEO confirmed the airline remains interested, despite acknowledging the talks are proving very complex. Turkish Airlines also reportedly expressed interest, hoping to expand its European reach. Meanwhile, Air Europa urgently seeks investment to repay government loans and stabilise operations.

With Air Europa off the table, Air France-KLM is refocusing on Scandinavian Airlines (SAS). The group already owns 19.9% of SAS and plans to increase that to 60.5%. Regulatory approval is pending, but Air France-KLM sees strong long-term potential in SAS.

European Airline Consolidation Gains Momentum

Airline groups across Europe continue pushing for consolidation to compete with U.S. and Middle Eastern carriers. Lufthansa acquired majority control of Italy’s ITA Airways and a 10% stake in airBaltic. Air France-KLM and British Airways’ parent IAG are pursuing regional deals, aiming to dominate key Southern European routes.

IAG, which owns 20% of Air Europa, had previously aimed for full control but backed away over regulatory challenges. Now, IAG may sell its stake as Globalia entertains new bids. Air Europa’s next partner will likely shape Europe’s airline landscape for years to come.