Iberia Gets Heated with British Airways After Qantas Merger Announcement

British Airways confirmed they are having merger talks with Qantas on Wednesday, upsetting Iberia who is hoping to merger with British Airways themselves.

Fernando Conte, the Chief Executive of Iberia, said on Wednesday that he wasn’t informed of the secret merger talks between Qantas and British Airways until only an hour before they made a public announcement. He told Aviation Club members that he didn’t have much information about the talks at the present moment.

Both Iberia and British Airways have been talking about a merger for the past 5 months. However, despite their intention to strengthen the links more while huge losses are posted by carriers, Iberia criticized British Airways about their lack of commitment to their merger.

Nick Cunningham, an Evolution Securities analyst, said that the process of consolidation looks more complicated now that there are 3 airlines looking for a merger. Any merger agreement is hard, as 2 parties have to have an equal value, he continued. However, combining British Airways and Qantas will not be an equal value to Iberia and vice versa, he added.

Analysts see a merger between British Airways and Iberia to be more beneficial for the short term in comparison to an agreement between British Airways and Qantas. A merger for British Airways and Qantas would be harder to achieve since Australian authorities warned that an approval of a £4 billion merger would be given if Qantas kept a significant base in Australia.

To show their commitment to a merger with British Airways, as well as to strengthen their negotiating power, Iberia increased their stake in the airline to 9.9% during recent weeks. British Airways has a 13.2% stake in Iberia already.

Get more information about these airlines by visiting: www.britishairways.com, www.iberia.com, or or www.qantas.com.au