BA and Iberia sign merger agreement
The merger of British Airways and Iberia moved a step closer today after the two airlines signed the agreement approving their tie-up.
BA said it expected the merger to be completed by the end of this year in a move that will create one of the world's largest airline groups, with 408 aircraft carrying more than 58 million passengers a year.
The tie-up will create a new holding company called International Airlines Group, but the airlines will retain their current operations and continue to use their individual brands.
Today's merger agreement follows the memorandum of understanding signed between the two airlines in November.
BA chief executive Willie Walsh said the merged company will provide customers with a larger combined network.
"It will also have greater potential for further growth by optimising the dual hubs of London and Madrid and providing continued investment in new products and services," he added.
The merger is subject to regulatory approval from competition authorities including the European Commission, and to approval by both British Airways and Iberia shareholders.
Iberia will also be entitled to terminate the merger agreement if the pension recovery plan agreed between BA and its pension trustees is found to be "materially detrimental" to the merger.
Rival airlines have expressed opposition to the agreement, with low-fare carrier Ryanair recently likening the merger to "two drunks trying to prop each other up". Virgin Atlantic said the deal would increase BA's dominance at Heathrow Airport.
The merger is expected to produce annual savings of around 400 million euro (£350.9 million) by the end of the fifth year after the merger's completion.
The Independent travel offers: Discover a world of inspiring destinations
- 1 Should Apple buy Greece?
- 2 Michael Douglas regrets 'embarrassing' Catherine Zeta-Jones with oral sex comments
- 3 Drummer Lee Rigby's family reject 'extremist' groups using Woolwich murder for political gain
- 4 Tunisia hotel attack: Locals form 'human shield' to protect hotel from gunman Seifeddine Rezgui
- 5 Fox News anchor asks 'what's to prevent' three people from marrying after same-sex marriage legalised
The moment a Queen's Guard soldier lost it and drew his gun at annoying tourist
Greece crisis: The wider lesson is that it’s time to abandon this failed experiment in currencies
'I wish the BBC would stop calling it Islamic State' – David Cameron unleashes frustration at broadcaster
Extend Right To Buy to tenants of private landlords, Labour's Jeremy Corbyn says
David Cameron struck double blow in his hopes to win Britain a new EU deal
Pentagon accuses Russia of 'playing with fire' over nuclear threats towards Nato
£22300 per annum: Recruitment Genius: This museum group is looking for a Payro...
£39,000: ICE ICT: Specific and detailed knowledge and experience of travel sys...
£25000 - £29000 per annum: Recruitment Genius: To support their continued grow...
£25K + Benefits: Guru Careers: We are seeking an experienced Plumber / Mainten...