Itochu to Acquire Minority Stake in Iberia-Led IAG Engine Tech Engine MRO Business
Why It MattersA Japanese conglomerate with aircraft leasing and parts interests entering an airline-group engine shop shows airline-owned MROs reaching for outside capital to compete for third-party narrowbody engine work.
Iberia has agreed terms with Itochu Corp. for the Japanese group to acquire a minority stake in IAG Engine Tech, a new engine maintenance, repair and overhaul (MRO) provider. The agreement, confirmed on Oct. 27, is intended to bring investment, industrial expertise and international reach to the business, which is focused on third-party aftermarket work. IAG Engine Tech was established earlier this year as a designated engine maintenance business within International Airlines Group (IAG), the parent of Iberia, Aer Lingus, British Airways, Level and Vueling. Through Iberia, IAG will retain a majority shareholding. The new MRO will begin operating in Madrid from early 2027, and the investment is expected to complete by early 2027, subject to regulatory approvals and consents.
Itochu is a Tokyo-headquartered conglomerate with investments across multiple industries. Its aviation interests include several aircraft leasing ventures, among them a 50% equity interest in TC Skyward Aviation U.S., jointly managed with Tokyo Century, and Ireland-based Killick Aerospace, which received Itochu investment in 2024 to scale used aircraft parts and OEM distribution businesses. Iberia CEO and Chairman Marco Sansavini said the addition of Itochu brings a partner with experience, investment capacity and a strong international presence, and that its support will be important in developing the full potential of IAG Engine Tech.
When operational, IAG Engine Tech will assume work from Iberia Maintenance at its La Muñoz facility in Madrid. Its engine repair capabilities will include International Aero Engines V2500, CFM International CFM56 and Pratt & Whitney PW1000G engines and, eventually, CFM LEAP engines. Iberia joined the CFM Premier MRO aftermarket network for the narrowbody engine last April, and over the long term intends to oversee maintenance on both IAG fleet engines and third-party customer engines.
