BA in no hurry for Iberia merger talks

British Airways does not feel under pressure to obtain a quick merger deal in talks with Iberia and will not settle for less than 53 per cent of the new group, BA's Chief Executive said, according to Spanish newspaper Expansion.

"These negotiations aren't a distraction for our management team. BA and Iberia know each other very well, so I don't feel under any calendar pressure," Willie Walsh told several newspapers, according to Expansion.

Walsh repeated that BA's shareholders would not accept less than 53 percent of the stock in the new group.

"These comments give an indication of some steps forward in the negotiations," said brokerage BPI in a research note.

Walsh said Madrid Airport would be key to the growth of the company following any merger, Expansion said.

BPI said the Madrid hub comment might be an attempt to curry favour with Iberia's leading shareholder, savings bank Caja Madrid, which is controlled by Madrid regional authorities.

Walsh said he would be happy for Caja Madrid to have a leading role in the new company.

"I would be delighted to have a financial institution with cash as our leading shareholder, given the market crisis," Walsh said.

Walsh said in March that issues over BA's pension deficit and the ownership split between the two airlines had been resolved, and he was confident a deal could be done.

He said the main difficulty was the financial control of the proposed parent company over the two airlines, which would retain routes and brands.

BA and Iberia announced talks about an agreed all-share merger last July.

At 0930 GMT, Iberia shares were up 1.23 per cent at €1.64 (Dh8) and British Airways was 1.69 per cent higher at 162.3 pence.

 

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