A Giant of the Air is born

The merger of Iberia and British Airways has become reality as shares in the new International Airlines Group (IAG) parent are listed for trading on the stock exchanges of London, Madrid, Barcelona, Bilbao and Valencia.

The merger will facilitate access for customers of both airlines to a network of 204 destinations around the world. For Iberia customers, this means more facilities for travel to Asia, where British Airways is well established, while British Airways customers will have more options for travel to Latin America, where Iberia is market leader and flies from Madrid to 19 destinations.

The airlines expect annual synergies worth some 400 million euros starting the fifth year following the merger. Some 60% of these synergies will arise from cost savings, and 40% from larger revenues.

IAG is registered as a Spanish company with tax domicile in Madrid, where its board of directors and general shareholders meetings will be held. Its financial and operational headquarters will be located in London.

The IAG board, which has already been constituted, is made up of 14 members, seven from each airline. Three people from each company will serve on the six-member group management team.

Passengers will also enjoy better connections and timetables, since the two airlines will coordinate their services. In coming weeks and months the flights operated by each airline will progressively become available on the other's web site and telephone reservations lines.

It will also be possible to combine fares of the two airlines, and to choose the most suitable. Other advantages to passengers include access to more than 120 VIP lounges in airports around the world. Frequent flyers will also gain from the coordination between Iberia Plus and BA's Executive Club organizations. Benefits will be increased, though the two will remain separate.