Delta Air Lines' proposed strategic tie-up with Virgin Atlantic has been cleared by the European Commission.

The US carrier can acquire Singapore Airlines' 49% stake in UK-based Virgin Atlantic to create a new combined transatlantic operation, says the Commission. The Virgin Group will retain 51%.

Explaining its decision, the Commission says its investigation confirmed that in all markets the merged airlines would continue to face competition from several strong competitors, notably British Airways and American Airlines, which are "capable of exercising a significant competitive constraint on the combined entity".

Delta and Virgin Atlantic services overlap on the London-New York and London-Boston routes, and on several routes between the UK and North America, notes the Commission.

The airlines still need to gain antitrust immunity from the US Department of Transportation to allow the joint venture to be implemented.

Delta and Virgin made their plans public in December 2012, with the US carrier saying it planned to acquire Singapore Airlines' stake in Virgin for $360 million.

Source: Air Transport Intelligence news