Mayfair hedge fund takes £140m stake in British Airways owner
One of the UK’s largest hedge funds has taken out a large position in embattled British Airways owner IAG amid the worst crisis in aviation history.
£35bn Marshall Wace today disclosed a three per cent stake in the airlines group, making it one of IAG’s largest stockholders.
The Mayfair-based fund has previously taken out short positions against European flag carriers such as Lufthansa and Air France.
Both of those carriers have already been on the receiving end of nearly €20bn of state aid from their respective governments.
Although the pandemic has hammered airlines of all stripes, flag carriers such as BA have been particularly badly hit due to the decline in business travel.
Profitable routes such as the transatlantic London-New York remain closed after seven months of restrictions, with little indication that they will open up any time soon.
Last month the carrier completed a £2.5bn capital raise ahead of the traditionally loss-making winter months.
Early in the pandemic it also drew down £300m from the Bank of England’s Covid Corporate Financing Facility (CCFF).
Marshall Wace’s stake, which was reported by the Telegraph, is worth about £140m.
IAG’s largest shareholder is Qatar Airways, which owns a hefty 25 per cent of the group.
On Monday, the company surprised investors by axing BA chief exec Alex Cruz in Luis Gallego’s first act of note as IAG’s boss.
It came after a turbulent summer which saw the British airline branded a “national disgrace” by lawmakers amid a mass restructuring of its workforce.