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News that Gordon Brown met the French president and the European commission on Monday has rather upset the German government who were left out of the talks. The talks were aimed at finding a...
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Investments News - Last Updated Monday 22nd December 2008 Syndicate this
Is the British Airways Qantas merger on the rocks already?

Monday 22nd December 2008

A number of remarks attributed to the man in control of Australian airline Qantas has thrown into doubt the merger with UK giant British Airways which had only been flagged some days ago. Not only are their significant regulatory hurdles to clear for the �3.5 billion merger, which also includes Iberia, but the merger appears to be falling apart at the seams already. Internal bickering and concerns that all parties were not kept aware of the long-term aims of British Airways has caused much friction.

This has very much put British Airways into play with a number of US airlines already expressing an interest in one of their main competitors. While a takeover would appear out of the question at the moment, due to funding requirements, a more attractive merger with a larger US operation may well tempt British Airways out of the three-way tie-up with Iberia and Qantas which looks like being very difficult to conclude.

It would also seem highly likely that the US authorities would look favourably on a British Airways merger with a US giant as a way of promoting and safeguarding the future of the US sector. British Airways looks to hold all of the trump cards at the moment although if the Qantas and Iberia three-way merger was to fall apart at the seams this may well leave the company open to further corporate activity.

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