Both airlines have wanted this for some time. I’m sure it will happen eventually but it’s not yet the done deal that the Yahoo headline implies.
From the BA intranet:
“British Airways today announced it is in talks with Iberia with a view to a merger between the two companies.
Both companies would keep their own brands and identities, each with day-to-day responsibility for the running of their operations. A new company would be formed to hold the shares in BA and Iberia.
The holding company would have a combined balance sheet and unified executive management structure built on representation from both companies.
The type of merger under consideration is known as an ‘all-share merger’, which means there would be no cash payment from either side.
Speaking from Madrid, chief executive Willie Walsh said: “The talks we are announcing today are made possible by the liberalisation of the aviation industry. They also come at an important time when the industry faces an unprecedented combination of record oil prices, economic slowdown and weak consumer confidence.
“I believe a merger would enable both our airlines to take advantage of liberalisation and grow stronger together. It would create a more financially viable airline that is better able to compete in today’s tough market environment.
“We would be able to offer our customers an improved product and service, with more destinations and better schedules.”
A merger would create the third largest airline in the world in terms of income — more than 16.5 billion euros — with the fifth largest fleet of nearly 450 aircraft.
It is anticipated that the talks with Iberia will take several months to conclude.”
Do you think i should be brushing up on my Spanish?
1L.
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