International Airlines gains control of Spain's Vueling

Tue Apr 23, 2013 6:57am EDT

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* IAG has around 90 pct of no-frills airline

* Deal values Vueling at 277 mln euros

* IAG up 4 pct

MADRID, April 22 (Reuters) - International Airlines Group (IAG) , the owner of British Airways and Iberia, has won sufficient backing from investors in Vueling to take control of the Spanish budget airline, Spain's stock market regulator said on Tuesday.

IAG now has around 90 percent of Barcelona-based Vueling, up from 46 percent, after a takeover bid that valued the company at 277 million euros ($360 million).

IAG offered 9.25 euros a share after Vueling's management rejected a previous offer of 7 euros per share.

IAG is trying to lay off more than 3,000 workers and cut salaries at Iberia to return it to profitability.

IAG Chief Executive Willie Walsh said this month the company would not merge Vueling with Iberia.

But the takeover should help IAG boost its short-haul business and Vueling's profits will help offset the group's losses in Spain.

Vueling shares were down 1.8 percent at 8.93 euros at 1054 GMT while IAG was up 4.3 percent at 3.12 euros.

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