Howard Wheeldon: Why this is the best deal for investors
Saturday 14 November 2009
There is no reason why investors should not welcome the prospect of a merger between British Airways and Iberia. This is far more about revenue and profit enhancement than it is about cost savings.
At its simplest, you take BA's strengths – Asia, Middle East and North Atlantic – and put them with Iberia's strengths - South and Latin Americas, plus Africa – and you have a global airline. In time, BA and Iberia will adjust their respective services to more suit customer need, removing overlapping services, even freeing certain slots at Heathrow.
Still, all of this benefit can only be in the future. Indeed, we cannot even begin to say when the recession in the airline industry will start to abate, or whether when it does, a sharp rise in the fuel price will immediately follow.
But such uncertainties are all additional reason to back the prospect of a workable consolidation such as this, even if one would be stupid not to admit that BA might have done a lot better if it had pursued a merger with KLM years ago instead of letting it escape into the eager hands of Air France.
Howard Wheeldon is senior strategist at BGC Brokers
Sales of the tablet are set to fall again, say analysts
Met Police confirm there was a 'minor disturbance' and that no-one was arrested
George Lucas criticises the major Hollywood film studios
Does Chris Grayling realise what a vague concept he is dealing with?
Trend which requires crisps, a fork and a strong stomach is sweeping Mexico's streets
Parties threaten resort's image as a family destination
I Am Bread could actually be a challenging and nuanced title
- 1 Indian footballer Peter Biaksangzuala dies after injuring spine doing somersault celebration
- 2 Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
- 3 Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
- 4 Drink alcohol and eat meat to improve male fertility - but cut down on coffee, studies suggest
- 5 Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Banksy arrest hoax: Internet duped by fake report claiming that the street artist's identity has been revealed
'Russian submarine spotted' by Swedish military off coast of Stockholm
Brian Harvey turns up at Downing Street and 'demands to speak to Prime Minister'
Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Sorry Judy Finnigan – Ched Evans is no less sickening than an alleyway rapist
Residents should throw a street party and mix with immigrant neighbours, councils told
Workers 'could be forced to pay £5 a week' to get benefits
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver allegedly kicks gay couple off for kissing
iJobs Money & Business
£18 - 23k + Benefits: Guru Careers: We are seeking a Customer Service Executiv...
£60 - 65k + Benefits: Guru Careers: We are seeking a ASP.NET Web Developer / ....
£60,000 - £80,000: Saxton Leigh: Our client is an leading Asset Manager based...
£27000 - £32000 Per Annum: Clearwater People Solutions Ltd: Our large charity ...