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EU vets IAG rivals' ability to take over Air Europa routes, sources say

FILE PHOTO: An Air Europa plane approaches Riga International Airport, Latvia

By Foo Yun Chee

BRUSSELS (Reuters) - EU antitrust regulators are asking whether rivals proposed by British Airways owner IAG to take over some of Spanish airline Air Europa's routes are capable of operating them and competing with IAG, people familiar with the matter said on Monday.

IAG, which also owns Spanish airline Iberia, last week offered fresh concessions in a bid to allay the European Commission's worries about the impact of the deal on Spanish short- and long-haul flights.

These included making available 52% of Air Europa's 2023 flights to rivals, another source said. Ryanair, Volotea, Iberojet and Binter have signed memoranda of understanding with IAG for short-haul flights and Avianca and World2Fly for long-haul. The details of the MOUs were not disclosed.

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The EU competition watchdog has asked rivals about the suitability and market strategy of the potential remedy takers, the people said.

The commission wants to know whether the rivals have the financial capability to operate the routes, and they have until this week to provide feedback, one of the people said.

The commission, which has set an Aug. 20 deadline for its decision, did not immediately respond to a request for comment.

IAG, which owns a 20% stake in Air Europa, is paying 400 million euros ($429 million) to buy out remaining shares from Spanish tourism company Globalia, its second attempt after it abandoned a previous deal in 2021.

($1 = 0.9325 euros)

(Reporting by Foo Yun Chee; Editing by Cynthia Osterman)