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IAG: BA restructuring may cost 12,000 jobs

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IAG: BA restructuring may cost 12,000 jobs

Old 1st Aug 2020, 10:41
  #1461 (permalink)  
 
Join Date: May 2001
Location: London,England
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Going back 74 pages the title of this thread now looks rather optimistic, wouldn't be surprised if this costs 24000 jobs in the end, we are completely and utterly screwed (edited to add) at the moment with no obvious way that we can stem the huge losses in the near future.

Last edited by Max Angle; 1st Aug 2020 at 11:22.
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Old 1st Aug 2020, 11:14
  #1462 (permalink)  
 
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I wouldn't say screwed, but expect further pay cuts (Temporary hopefully) until a return to profitability.
I'm sure a process was agreed by BALPA if the financial situation was to deteriorate further.
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Old 1st Aug 2020, 12:04
  #1463 (permalink)  
 
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You are burying your head in the sand mate. The share price went down 6% yesterday from a really low base. This is institutions selling while they still have money left. The expectation of a good outcome is only speculative.
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Old 1st Aug 2020, 12:11
  #1464 (permalink)  
 
Join Date: Mar 2014
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The share price drop was due to the rights issue announcement.
This will probably be approved by shareholders in September.

Since we do not yet know the share-pricing for this, there is uncertainty causing the sell-off.

If they go for fair-value, say £2.50, the share price will likely rise to that level.
Qatar may have a say on the issue price since they are having 2 on the board, and may not wish to suffer too much dilution.
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Old 1st Aug 2020, 12:19
  #1465 (permalink)  
 
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Rights issues sell shares at a discount and not a premium. If you're pinning hopes to a rights issue, that may raise 2 months of Cash, then you're in extreme trouble. The reliance on Qatar shows desperation. Air Italy were not allowed to increase flights to the US due to Qatari money.
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Old 1st Aug 2020, 12:32
  #1466 (permalink)  
 
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The rights issue has been mulled about for some time, maybe even when the price recently went above 350p, who knows.

Sure it will be at a discount at the time of announcement, then the actual share price will hover at that level.
I expect Qatar and others to pick up some IAG shares at bargain prices, with a longer-term view.

Current liquidity of €8.1 billion isn’t quite ‘desperation’.
Apparently, they have bridged loan facilities for a further year.
The rights issue will increase liquidity by a further c.€3bn.

And they still want to buy another airline?
Hardly ‘fighting for survival’ just yet.

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Old 1st Aug 2020, 12:38
  #1467 (permalink)  
 
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Was it you that told me to deliver hard facts?

The €8.1B includes the rights issue. That is hopeful by itself. Bridging loan, hopeful, at best. Buy another Airline, don't make me laugh.
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Old 1st Aug 2020, 12:47
  #1468 (permalink)  
 
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Originally Posted by Dannyboy39 View Post
You really expect the Tory-backed Times to speak highly of unions - Unite in particular?
When did you last read the Times, not recently I'm sure.
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Old 1st Aug 2020, 12:53
  #1469 (permalink)  
 
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kungfu panda

The rights issue hasn’t happened yet.

Here’s a hard fact (they are not allowed to lie or spin to the City):

"IAG continues to take action to strengthen its balance sheet and liquidity position including more than halving its operating cash costs and significantly reducing its capital spending. At the end of June liquidity stood at €8.1 billion.Based on our current capacity planning scenario, we would reach breakeven in terms of Net cash flows from operating activities during quarter 4 2020.”
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Old 1st Aug 2020, 12:59
  #1470 (permalink)  
 
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I have had it with this thread as I suspect most pilots have. The Armageddon views of several current posters is truly depressing. I cannot imagine why current crew would want to impart such negativity amongst their colleagues unless they either had an ulterior motive or are just plain unpleasant.
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Old 1st Aug 2020, 13:00
  #1471 (permalink)  
 
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777JRM

Yes. At the End of June. It's now August and everything looks a whole lot worse than it did in June. That's why the share price is languishing.
You're talking about a rights issue that raises nearly the total market Capitalisation of IAG. That is unrealistic. If Qatar put in that kind of money, it's shareholding would be upwards of 70%.
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Old 1st Aug 2020, 13:23
  #1472 (permalink)  
 
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BA will survive maybe as a result of the combined effort of Qatar and the British government. It will not survive in it's own right as a going concern. The Qatar money maybe a big issue to the Americans.
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Old 1st Aug 2020, 13:27
  #1473 (permalink)  
 
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kungfu panda

Qatar may be legally limited to how much of IAG they can own.

This implies that other institutions will be able to take part in the rights issue.
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Old 1st Aug 2020, 13:32
  #1474 (permalink)  
 
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I believe the rights issue is because the Board realise that itís the cheapest way to gain some more time.
As WW has repeatedly stated the company has barely 20% revenue at the moment, with L/H to the states almost zero.
They have a willing buyer in Qatar so the issue should be funded. Someone has mentioned why Qatar? I believe itís because they too have problems with the Saudi over flight ban, they have plenty of cash and are always looking to diversify. Look at their huge investments in the City. So this is not a normal transaction, just pragmatic for both parties.
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Old 1st Aug 2020, 13:34
  #1475 (permalink)  
 
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777JRM

Yes absolutely. Qatar will put in €800m. IAG want to raise €2.7B.

But the share price is dropping fast because institutions are selling, not because of the rights issue. If the rights issue actually went ahead the shares right now are probably worth around 90p.
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Old 1st Aug 2020, 16:50
  #1476 (permalink)  
 
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I'm an outsider looking in. But let me get this straight. Ba pilots have accepted a paycut, meanwhile Ba owner Aig is still proceeding with the acquisition of Air Europa. It looks like you guys have been hustled. And I thought that the french were the surrender artist's.

Last edited by lear999wa; 1st Aug 2020 at 17:20.
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Old 1st Aug 2020, 18:03
  #1477 (permalink)  
 
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Yes but whatever the rights and wrongs of the deal, mergers and acquisitions are normally made via lease, leverage or share offers whereas salary comes out of revenue....now read the previous posts about revenue.
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Old 1st Aug 2020, 22:30
  #1478 (permalink)  
 
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Perhaps if BA had approached this whole afair in a more professional manner we would be further towards a solution now instead of banging heads. Remember, the opening salvo to this was BA announcing 12000 plus compulsory redundancies and further redundancies for everyone else with an offer of a new contract on vastly inferior pay and T & Cs.
If, just if they had got around the table first, talked about the problem and discussed solutions in an open and honest exchange as has happened during previous crisis we could have avoided all this animosity and come out of this with a bit of pride and a spirited attitude to the future. But no, what we have is a bitter, dissalusioned workforce who will either walk away next week despising their previous employer or you will have the chosen ones, equally bitter and angry but forced into accepting their lot as their is no alternative.

Remember it wasn't so long ago that BA was sending everyone pin badges and invites to '100 year' celebrations because "our people are our biggest asset". What a crock!

This could have been handled so much better. Only one person is to blame.
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Old 1st Aug 2020, 23:44
  #1479 (permalink)  
 
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Maybe a few others are complicit too - those gangsters known as ‘Management Committee’.

Agree with the above: the actions of a bully.
BA seems to like picking fights: pilots, cabin crew, engineers, ground crew, government, even its own customers, have been victims.
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Old 2nd Aug 2020, 05:07
  #1480 (permalink)  
 
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The current version of BA is in it's death throws. The only way to have saved it would have been to furlough 80% of staff indefinitely and quickly, without any discussion. Which of course would be legal in the U.S. but is not in the UK. If they had done that then they would already be calling people back from furlough.
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