Has British Airways finally found a partner for life?
As the proposed British Airways and Iberia merger finally seems as though it will happen there is relief at British Airways bearing in mind the recent conflict with union representatives. The deal, which was announced last year, had initially been put on the back burner due to various technical hitches and issues regarding the British Airways pension scheme deficit. However, it now seems as though both parties have reached a final agreement with speculation that authorities in the UK and Spain have already signed off the structure for the new company.
Many believe that the proposed merger will kickstart a new phase of mergers and acquisitions in the airline industry which is suffering from increased regulatory costs, increased fuel costs and reduced passenger numbers. Just days after the confirmation that British Airways and Iberia intend to go ahead with the merger we have seen rumours in America of potential activity within the airline industry. The ability to manage costs and manage operational gearing is something which will be at the forefront of the minds of many chief executives in the industry.
It is hoped that regulatory clearance will be received sooner rather than later for the merger as historically it has often been difficult to bring all regulators under one umbrella.
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