Merger talks between oneworld partners British Airways and Iberia have picked up pace after the Spanish carrier secured clarity on issues relating to BA pensions schemes.
Progress has been slow since talks on the all-share merger between the two carriers were announced in July. But recent indications from their respective chief executives seem to point to fresh momentum.
BA chief executive Willie Walsh says talks with Iberia have made significant progress in the past couple of weeks. "The discussions were really dragging on, largely as a result of Iberia's need to understand better the rules around defined benefits pensions schemes, and particularly our two defined benefits schemes and to understand the role of the regulator in the UK," he says.
Iberia commissioned pensions specialist Mercer to carry out a report on the pensions situation and the Spanish carrier's chief executive Fernando Conte says this report contained no surprises. Walsh says this has now allowed the discussions to speed up on other issues.
"Those discussions have been very positive, with good progress made. We are not at the point where we have reached agreement, but we are getting to a point where I think agreement is definitely possible," says Walsh.
The main remaining issues relate to governance, synergies and valuation. The latter is complicated by the weakening of Sterling which has reduced the stock market value of BA and which the UK carrier says means the current stock value is not representative of its full value.