Norwegian Air Just Rejected 2 Bids for a Complete Takeover From BA's Parent Company
Norwegian Air thinks its worth more than British Airways' parent company International Airlines Group (IAG) is offering to pay. On Friday, Norwegian Air, the low-cost carrier that's been disrupting the transatlantic market and continues to expand, said that its board has unanimously rejected two bid offers from IAG.
IAG, which is the parent company of British Airways, Iberia and Aer Lingus, among others, announced last month that it acquired a 4.6% stake in Norwegian. At the time, IAG was considering a full takeover of Norwegian, and on Friday, it confirmed that it did make a takeover offer — and Norwegian says it made more than one.
On Friday, Norwegian released the following statement, regarding its decision to reject both of IAG's takeover offers:
"The board of Norwegian Air Shuttle (NAS) confirms that it has received two separate conditional proposals from IAG Group in relation to an acquisition of 100 percent of the share capital of NAS.
These proposals were reviewed in conjunction with NAS' financial and legal adviser, and were unanimously rejected on the basis that they undervalued NAS and its prospects. The Board of NAS remains fully committed to delivering on its stated strategy, for the benefit of all NAS shareholders."
IAG said on Friday that since Norwegian rejected two of its offers for a takeover, it's now considering its next move, Reuters reports. "We'll have a look at all of our options in relation to Norwegian," IAG CEO Willie Walsh said.
In the eyes of IAG -- a company that reported a 75% jump in its quarterly profit on Friday -- there's no rush for this Norwegian deal. IAG expects Norwegian's financial struggles to continue. The low-cost carrier's expansion has put it in direct competition with many of the airlines that fall under IAG's umbrella. As a result, its airlines have been forced to readjust their strategy in order to better compete with the low fares offered by Norwegian. IAG itself launched a new low-cost carrier of its own in order to compete with Norwegian, called LEVEL, which operates transatlantic flights out of Barcelona (BCN) — also a transatlantic hub for Norwegian.
That being said, Norwegian has struggled greatly — even with all of its continued expansion, which has placed further strain on its earnings and fleet. The carrier reported a net loss of €30.8 million in 2017, compared to a €116 million profit in 2016. The loss was driven by significant costs associated with hiring in its expansion, as well as rising fuel costs. It's also struggling to uphold its fleet. Though it does operate new 787 Dreamliners and 737 MAX aircraft, the ongoing issues with the Rolls-Royce Trent 1000 engine have forced the carrier to lease aircraft from other operators while its Dreamliners undergo repair.
Following Norwegian's announcement on Friday, shares had dropped about 12%, after having risen in April when IAG took 4.6% stake. At the end of 2017, the airline was 22.3 billion Norwegian krone in debt.
Though Walsh and IAG are still considering options, Walsh said Friday that he doesn't believe Norwegian's expansion plans are sustainable. It remains unclear if the company will reach out to Norwegian with another offer.
TPG featured card
at American Express's secure site
Terms & restrictions apply. See rates & fees.
| 3X | Earn 3X Miles on Delta purchases. |
| 1X | Earn 1X Miles on all other eligible purchases. |
Pros
- Delta SkyClub access when flying Delta
- Annual companion ticket for travel on Delta (upon renewal)
- Ability to earn MQDs through spending
- Various statement credits for eligible purchases
Cons
- Steep annual fee of $650
- Other Delta cobranded cards offer superior earning categories
- Earn 100,000 Bonus Miles after you spend $6,000 or more in purchases with your new Card within the first 6 months of Card Membership and an additional 25,000 bonus miles after you make an additional $3,000 in purchases on the Card within your first 6 months, starting from the date that your account is opened. Offer Ends 04/01/2026.
- Delta SkyMiles® Reserve American Express Card Members receive 15 Visits per Medallion® Year to the Delta Sky Club® when flying Delta and can unlock an unlimited number of Visits after spending $75,000 in purchases on your Card in a calendar year. Plus, you’ll receive four One-Time Guest Passes each Medallion Year so you can share the experience with family and friends when traveling Delta together.
- Enjoy complimentary access to The Centurion® Lounge in the U.S. and select international locations (as set forth on the Centurion Lounge Website), Sidecar by The Centurion® Lounge in the U.S. (see the Centurion Lounge Website for more information on Sidecar by The Centurion® Lounge availability), and Escape Lounges when flying on a Delta flight booked with the Delta SkyMiles® Reserve American Express Card. § To access Sidecar by The Centurion® Lounge, Card Members must arrive within 90 minutes of their departing flight (including layovers). To access The Centurion® Lounge, Card Members must arrive within 3 hours of their departing flight. Effective July 8, 2026, during a layover, Card Members must arrive within 5 hours of the connecting flight.
- Receive $2,500 Medallion® Qualification Dollars with MQD Headstart each Medallion Qualification Year and earn $1 MQD for each $10 in purchases on your Delta SkyMiles® Reserve American Express Card with MQD Boost to get closer to Status next Medallion Year.
- Enjoy a Companion Certificate on a Delta First, Delta Comfort, or Delta Main round-trip flight to select destinations each year after renewal of your Card. The Companion Certificate requires payment of government-imposed taxes and fees of between $22 and $250 (for itineraries with up to four flight segments). Baggage charges and other restrictions apply. Delta Basic experiences are not eligible for this benefit.
- $240 Resy Credit: When you use your Delta SkyMiles® Reserve American Express Card for eligible purchases with U.S. Resy restaurants, you can earn up to $20 each month in statement credits. Enrollment required.
- $120 Rideshare Credit: Earn up to $10 back in statement credits each month after you use your Delta SkyMiles® Reserve American Express Card to pay for U.S. rideshare purchases with select providers. Enrollment required.
- Delta SkyMiles® Reserve American Express Card Members get 15% off when using miles to book Award Travel on Delta flights through delta.com and the Fly Delta app. Discount not applicable to partner-operated flights or to taxes and fees.
- With your Delta SkyMiles® Reserve American Express Card, receive upgrade priority over others with the same Medallion tier, product and fare experience purchased, and Million Miler milestone when you fly with Delta.
- Earn 3X Miles on Delta purchases and earn 1X Miles on all other eligible purchases.
- No Foreign Transaction Fees. Enjoy international travel without additional fees on purchases made abroad.
- $650 Annual Fee.
- Apply with confidence. Know if you're approved for a Card with no impact to your credit score. If you're approved and you choose to accept this Card, your credit score may be impacted.
- Terms Apply.
- See Rates & Fees