CEO Watch Qantas Chief: British Airways Deal in Doubt
Qantas Airways chief executive Alan Joyce warned investors its merger plan with British Airways could fall apart because of the British airline's potential deal with Spanish carrier Iberia, according to several reports.
"There's absolutely no guarantee that a transaction will be forthcoming," said Mr. Joyce said, according to the BBC. They were Mr. Joyce's first public comments since word of the merger was leaked last week.
"That's why I think we felt that the leak was a bit premature."
There are significant hurdles to overcome, said Joyce, citing British Airways' current pension liabilities, which total roughly $2.2 billion, according to the BBC.
But a bigger obstacle is British Airways' talks with Iberia.
"BA are conscious, I think as Iberia are and a we are, that only one of the transactions could take place," said Joyce, according to Reuters.
Mr. Joyce also told Australian investors that, in any deal, the majority of the company's shares would be held by Australian investors.
"Whatever happens, Qantas will remain majority Australian-owned, the vast majority of employees will always be Australian, and Australia will remain our headquarters," said Mr. Joyce, the BBC reported.
Airline mergers looked particularly appealing for the industry this year, say analysts, as summer-long record fuel prices gave way to falling demand in the face of worldwide economic turmoil.
Besides British Airways' merger talk with Qantas and Iberia, other airlines are looking for merger or deals. Lufthansa is trying to strike a merger with ailing Alitalia, as is Air France KLM, according to Reuters.
