BA in merger talks with Iberia

British Airways has confirmed it is in merger talks with Iberia after failing in a takeover bid for the Spanish carrier as head of a private-equity buyout last year.

The merger deal would involve a share swap. BA already has a stake of just over 13% in Iberia and the Spanish airline announced today that it has taken a 3% stake in BA.

The carriers’ networks would compliment one another without the need for substantial restructuring, with BA a major player across the North Atlantic and dominant at Heathrow and Iberia the biggest carrier between Europe and Latin America.

The UK airline is also poised to seek anti-trust immunity in the US for its alliance with American Airlines, which would allow the pair to co-ordinate fares and services.

BA chief executive Willie Walsh said: “The aviation landscape is changing and airline consolidation is overdue. The combined balance sheet, anticipated synergies and network fit make a merger attractive, particularly in the current economic environment. We are confident both companies’ shareholders would benefit.”

Iberia chairman and chief executive Fernando Conte said: “We have worked together for nearly 10 years and a tie-up would build on that success and develop Madrid’s position as the European gateway to Latin America.”

Both parties are confident of securing regulaory approval.


Share article

View Comments

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.