Vazquez vows to pursue BA Iberia merger

IBERIA’S new chairman, Antonio Vazquez (right), has stated that he will pursue the merger with British Airways (BA) that has come to a halt in recent months.

“I’ve come to Iberia with the objective of closing a deal with British Airways,” he said adding that negotiations “cannot go on for much longer.”

If the two carriers do merge then the new airline created would handle over a million tonnes of cargo a year, based on 2008 figures: BA handled 777,000 tons and Iberia 242,000. This would make it the largest operator on Europe-Latin America routes but still third in Europe behind Air France-KLM and Lufthansa.

Problems with the merger emerged when Iberia expressed concerns over BA’s pension deficit, which is estimated at around £3 billion – twice the company’s market value. In addition, BA wanted 65 per cent of the merged airline but is now willing to accept a 50:50 split.

The two are seeking approval from both European and American competition regulators, concerned over its potential dominance of certain routes.

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