The U.K.’s British Airways and Spain’s Iberia announced that they are in merger talks. The two have said that consolidation may help / compensate for the rising fuel prices that all airlines have had to face. British Airways and Iberia aren’t new to each other. As a matter of fact, British Airways holds a 13.15% stake in Iberia, and Iberia has nearly a 3% stake in British Airways. Both airlines are a member of the Oneworld alliance.
The combination of British Airways and Iberia would be similar to the Air France – KLM deal that happened a few years back. Both would continue to operate two brands under one corporation. BA and Iberia take advantage of their alliance and relation, but would like to take it a step further.
In America, people have been screaming consolidation for years. This time around, Europe has been caught in the middle. I’m sure British Airways would like to keep Iberia under its wing, since Lufthansa and Air France have been eyeing the carrier in recent years. This potential merger would be very beneficial to BA, since Iberia has a primary stake in the Madrid market.
Image: www.thisislondon.co.uk
