10 JULY 2017
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Directors of El Al Israel Airlines have approved a plan by its Sun d'Or subsidiary to buy smaller rival Israir from IDB Tourism. Sun d'Or, which flies to 17 destinations around Europe, will pay up to $24m, while IDB will receive a 25% stake in Sun d'Or.
Israir, which flies to 28 cities in Europe, will become a wholly-owned unit of Sun d'Or, with El Al saying the deal is expected to be signed in the coming days, with closing planned for 31 December.
The transaction still needs various approvals, including from the antitrust regulator as well as the signing of a new collective agreement with Israir pilots. As part of the deal, Israir will sell to third parties the aircraft it owns for $70m and lease them back.
El Al chief executive David Maimon said the transaction was an important element in implementing El Al's long-term strategy for expanding and diversifying its products and services, “enabling us to grow the group’s revenue and accelerate growth”.
Israir is Israel’s third largest airline after El Al and Arkia and operates scheduled domestic and air taxi flights, plus international charters.
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