Iberia demands precedence in BA merger talks

Conte wants deal done before BA looks for other partners

The merger talks between BA and Iberia should take precedence over other merger talks, Fernando Conte warned yesterday.

The ceo of the Spanish carrier said it was a "more rational process" that this tie up went ahead first.

Mr Conte was speaking at the Aviation Club in London the day after BA confirmed it was in merger talks with Australian carrier Qantas.

Mr Conte revealed he only found this out when BA's ceo Willie Walsh phoned him an hour before the announcement.

He said he and Mr Walsh would now be having a meeting to "clarify" the situation "very soon."

Citing the Air France KLM merger, Mr Conte told the Aviation Club that link ups between European carriers worked but it was unknown if tie ups between airlines from different continents would succeed.

"I do believe in global consolidation, but at this point, from a regulatory point of view and maybe political one, we are still not prepared for that.

"However, I think a merger or collaboration within the EU is a totally different scenario from one between companies on different continents."

BA and Iberia, both member of the oneworld alliance, have been negotiating for several months on the planned all-share merger.

News of BA parallel talks with Qantas, another oneworld member, emerged only last Tuesday.

BA, American Airlines and Iberia have also applied to the US Department of Transportation for anti-trust immunity to allow closer co-operation between them.

BA's treasurer, George Stinnes said all three initiatives could succeed.

He said there were not alternatives. "We would be very happy to consummate all these transactions," he said. "It's certainly not an ‘either- or' situation."

While declining to give a time scale, Mr Stinnes said BA was working it way through its agenda.

He added: "These things are very complex. It is not like going down to the corner shop and picking up some apples."

Mr Stinnes was speaking as BA released its traffic figures for November.

Traffic fell in the month by 5.9% compared with the same period on 2007. This included a drop of 10.8% in premium traffic and 4.8% in non-premium.

It load factor also fell by 2.2% to 74.4%. Capacity during the month was also down by 3.1% compared with November 2007.

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