BA / Iberia merger talks ‘to resume this week’
31.05.09
British Airways and Iberia will resume their merger talks within days, despite concerns from some board members that concluding an all-share deal will be impossible, the Telegraph reports. The two airlines are reported to have scheduled meetings this week to see if they can make progress on a deal, talks about which have stalled as the aviation industry's fortunes have dived amid the global recession.
BA's frustration at the lack of progress since talks began last July culminated in a discussion at a board meeting earlier this month about whether it should formally abandon the talks, 'people who advise the company' told the newspaper. The board decided, however, to continue the negotiations with Iberia on the basis that an agreement could still be reached.
The talks have hit several stumbling blocks, the most notable of which has been BA's ballooning pension deficit, which is estimated by analysts to be about £3bn. A formal deal is still months away, BA admitted recently, but if one is reached, it is unlikely to be significantly different from the framework outlined by the two companies last year.
Industry analysts believe there is compelling commercial logic in BA and Iberia merging because of the considerable cost savings that would be generated by bringing their operations together. BA declined to comment.
Add to: del.icio.us | Digg it | Newsvine | NowPublic | Reddit
To book hotels heathrow airport or car park heathrow airport at the lowest price, click on these links to two great heathrow airport car parking and heathrow airport hotel price comparison page
