JSM Financial: BA and Iberia merger deal finally sealed.

April 8, 2010 - PRLog -- British Airways and Spain’s Iberia have announced that they have signed an $8 billion merger, JSM Financial sources report, creating the world’s third largest airline, bringing a three way unity deal a little closer.

Iberia and BA’s recently signed deal, on which talks began in July 2008 and which is expected to be finalized by December of 2010, was originally designed to help the two airlines stem joint annual losses of over $1 billion following the industry’s worst downturn in decades. The pair hope to cut costs by $ 532.85 million (€ 400 million) annually in order to better compete with industry leaders like Lufthansa and Air France.

The International Air Transport Association (IATA) has this month announced that airlines are slowly beginning to climb out of recession.

Under the new deal, JSM Financial has learned, the combined group will be majority owned by British Airways shareholders and analysts say the two companies are now better positioned for further consolidation.

Recent reports have indicated that BA, Iberia and American Airlines, all members of the Oneworld alliance, hope to deepen their present association to take advantage of the U.S.-EU “Open Skies” agreement which aims to liberalize transatlantic air traffic.


"The tie-up with American is the next thing on BA and Iberia's agenda now and this agreement brings that closer but they are probably looking at European and Asian carriers too. There are too many airlines in the world and bigger will be better in the future. BA will hope that this is the start of many more tie-ups," JSM Financial believes one industry analyst was recently quoted as saying.

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