ABSTRACT
This chapter aims to introduce the issue of the absence of sizeable intangible assets such as route rights and slots in most airline accounts. It examines how these might be valued for international airlines, and reviews various approaches to valuing all or part of such airlines. An airline’s intangible assets would include mainly its route/traffic rights, and the rights to take-off and landing slots at congested airports. A large number of factors may contribute to the value of traffic rights on a route, but they might be grouped in three main categories: route characteristics, management characteristics and transaction characteristics. The value of an airline’s intangible assets and goodwill could be inferred from a comparison of its total market capitalisation and the market value of its net tangible assets. Tangible assets cover both the fixed or physical assets of an airline and the long-term investments in other companies or airlines.
