LONDON – British Airways and the Spanish airline Iberia have reached a preliminary agreement for a merger that should be formalised early next year.
The BBC reports that the merger, which must be approved by the European Commission, would create one of the world’s biggest airlines.
Under its terms, Iberia would take a 45 percent stake and BA, which last week reported a six-month pre-tax loss of £292m, a 55 percent stake in the company.
“The merger will create a strong European airline well able to compete in the 21st Century,” said BA chief executive Willie Walsh.
“Both airlines will retain their brands and heritage while achieving significant synergies as a combined force.”
It would create an airline with 419 aircraft flying to 205 separate destinations, the two partners said.
Iberia’s chairman Antonio Vazquez would take the same role at the new company, while Walsh would become its chief executive.
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BA already owns 13.5 percent of Iberia and the two carriers have a code-sharing agreement under the One World grouping of airlines, which allows them to sell seats on each other’s services.
