BA's Parallel Negotiations With Spanish Iberia Airlines Cause
Australian Transport Minister Anthony Albanese has confirmed
again that Qantas Airways must remain 51% in Australian hands in
order to comply with a range of laws and international agreements,
which require that the company has its headquarters in Australia,
two-thirds of the board are Australian citizens and the chairman is
This will complicate, though not make impossible,
a proposed merger with British Airways...
which may also falter due to parallel negotiations by the UK
carrier with Iberia of Spain, which has a significant stake in BA.
Qantas and Iberia are said to be opposed to a three-way merger.
Qantas CEO Alan Joyce and British Airways CEO Willie Walsh
recently met in Hong Kong to work out details of the merger,
prompting speculation that Joyce is readying a proposal to be
submitted to Qantas board members. If Joyce's bid wins board
approval, both airlines' advisors could begin discussions as soon
as early 2009.
The Courier-Mail reports Qantas and BA could realize a savings
of over $700 million by 2010 through cutting jobs, and duplication
of routes and services.
British Airways has already been making news and ruffling
feathers recently with other proposed joint ventures.
As ANN reported, American, British Airways,
Iberia, Finnair and Royal Jordanian recently filed an application
for worldwide antitrust immunity and have been seeking rapid
approval of their application. American Airlines also recently
announced it had reached a "joint business agreement" with British
Airways and Iberia.
That hasn't gone over well with APA... which represents 12,000
pilots at American, and is locked in contentious talks with
management over better pay. Hoping to put an end to the proposed
JV, the union has implored lawmakers and regulators to conduct a
full examination of related national security, competitiveness and
outsourcing issues associated with American Airlines' plans.
"The federal government depends upon
US airlines to carry troops and supplies in wartime as the nation's
Civil Reserve Air Fleet," said APA President Captain Lloyd Hill.
"Are we comfortable having foreign-flagged aircraft ferry our
troops in wartime?"
Hill questioned whether granting American Airlines the ability
to enter into a "virtual merger" with non-US carriers would
conflict with Congress' limits on foreign ownership and control. He
also emphasized the need to understand how the various nations'
different labor laws would be reconciled.
"The unintended negative consequences we are experiencing from
the relaxation of financial market regulations serve as a potent
reminder of the need to undertake thorough due diligence where
complex deals like this are concerned," Hill said.