Israir (6H, Tel Aviv Ben Gurion) parent Israir Group is one of the final bidders in a tender to buy a European airline for an estimated amount of between EUR20 million and EUR30 million euros (USD20.3-30.4 million), the company disclosed in a Tel Aviv Stock Exchange filing on the afternoon of July 26.

The group revealed two weeks ago that it was bidding in a tender to buy the airline, which it has not named but which it said has a European air operator’s certificate (AOC). Now it reports that the shareholders of the acquisition target “have approved its participation in the second stage, [...] the stage of carrying out a due diligence procedure for the European airline company, which in practice determines that the company is one of the final bidders.”

Israir also listed the possible ways it could raise the required capital if the deal is completed. It will “examine all the alternatives at its disposal, including raising from the public by way of publishing a shelf offer report, and/or through taking a loan from a financial corporation, and/or through the controlling owners of the company, and/or through the joining of a strategic partner to the transaction,” it said.

Local media speculated that Israir is interested in a strategic purchase that will give it more advantages than holding only an Israeli AOC, such as more slots, flights to destinations without being so dependent on Israel’s heavy security, and being able to operate flights on Saturdays.

Last month, Israir Group, known as BGI Investments until April 2022, raised just over ILS25 million shekels (USD7.3 million) in an initial public offering (IPO). It is predominantly a carrier oriented towards a leisure-travel network. On July 12, it disclosed that “following positive trends” in the leisure travel sector, its wholly-owned subsidiary Israir Aviation and Tourism had raised its stake by 20% in the Israeli company Diezenhaus Unitors Inbound Tourism for ILS8 million (USD2.3 million), to now own 100% of it.

In related news, the planned merger between Israir competitors Arkia Israeli Airlines and El Al Israel Airlines appears to be slipping away, even though the flag carrier has said it is still examining the deal. Sources told the financial daily Globes that Arkia is in now talks with alternative buyers who may replace controlling owners the Nakask brothers - Avi, Joe, and Rafi - who hold a 70% stake in the airline. The remaining 30% is owned by Arkia employees.

Arkia had been prevented from promoting contacts with other buyers as part of the exclusivity it gave El Al. This exclusivity period ended on June 29 and Arkia asked for it not to be extended. The airline is also looking at possibly staging an IPO similar to Israir’s, the sources said.