Spanish flag carrier Iberia has agreed terms with Itochu Corp. for the Japanese group to acquire a minority stake in IAG Engine Tech to support the growth of the new engine MRO provider.
Confirmed on Oct. 27, the agreement will bring investment, industrial expertise and international reach to expand IAG Engine Tech, which is specifically focusing on third-party aftermarket work.
IAG Engine Tech was established earlier this year to operate as a designated engine maintenance business within International Airlines Group (IAG), the parent company of Iberia as well as Aer Lingus, British Airways, Level and Vueling. Through Iberia, IAG will retain a majority shareholding in IAG Engine Tech. The new MRO will begin operating in Madrid from early 2027.
Itochu, a Tokyo-headquartered conglomerate, has investments across multiple industries and targets growth business markets. The company’s aviation interests include several aircraft leasing ventures. Most recent among these is a 50% equity interest in TC Skyward Aviation U.S., which it jointly manages with Tokyo Century, that it bought in August 2026.
Other aviation interests include Ireland-based Killick Aerospace, which was the recipient of Itochu investment in 2024 to scale used aircraft parts and OEM distribution businesses
The parties expect the investment in IAG Engine Tech to be completed by early 2027, subject to obtaining the necessary regulatory approvals and consents.
“The incorporation of Itochu allows us to bring on board a partner with experience, investment capacity and a strong international presence,” Iberia CEO and Chairman Marco Sansavini said. “Their support will be important in developing the full potential of IAG Engine Tech and strengthening our position in a market with significant growth prospects.”
When operational, IAG Engine Tech will assume work from Iberia Maintenance at its La Munoz facility in Madrid. The company’s engine repair capabilities will include International Aero Engines V2500, CFM International CFM56, Pratt & Whitney PW1000G and, eventually, CFM LEAP engines.
Iberia joined the CFM Premier MRO aftermarket network for the narrowbody engine last April, and long-term will look to oversee maintenance services on both IAG fleet and third-party customer engines.
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