BA to operate premium A318s under new subsidiary

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British Airways is establishing a new subsidiary through which to operate its premium transatlantic services from London City, a decision which appears linked to possible additional financing.

The new subsidiary, British Airways Limited, is securing its own air operator's certificate and operating licence. It will operate the two Airbus A318s in the fleet under a wet-lease arrangement with British Airways.

BA is reluctant to discuss the decision but says: "We are in the process of exploring a variety of options related to potential new sources of finance."

The new subsidiary has emerged from a previous company established under the name Acoperco on 14 March.

In the same month the UK Civil Aviation Authority disclosed that the company had formally applied for operating and route licences.

Acoperco subsequently changed its name on 17 May to British Airways Limited and appointed BA's chief executive Keith Williams and chief financial officer Nicholas Swift as directors, according to the company's regulatory documents.

BA has informed the US Department of Transportation that it is deleting the A318s from its own air operating certificate and transferring them to the new certificate of British Airways Limited. It had sought US clearance for the change by 11 June.

It has also sought clearance for British Airways Limited to codeshare with Oneworld partners Iberia - BA's corporate sister - and American Airlines on the 32-seat A318 routes.

British Airways Limited had been the name of a company formed in the 1930s which was eventually absorbed into BA predecessor British Overseas Airways Corporation.