British airways and Iberia airlines merger Essay

British airways and Iberia airlines merger - Essay Example Brief History of British Airways (BA) British Airways (BA), the flag carrier of the UK, is the largest airline in the United Kingdom on the basis of fleet magnitude flights and terminus. The airline was established in 1974 and has ruled the airline industry since its creation as regards passenger volume until the arrival of low-cost competitor, Easyjet in 2008. BA has been centered at London Heathrow Airport, which is the airline’s central hub. In its growth strategies, BA acquired Dan-Air, which increased its popularity at Gatwick Airport. BA also acquired 25 percent shares in Australian airline, Qantas in 1993. In 1998, the airline together with other leading airlines formed an alliance dubbed â€Å"Oneworld airline alliance.† The airline was privatized in 2006. BA experienced 84 percent drop in profits in 1999, its worst performance in seven years. Consequently, Rod Eddington succeeded Robert Ayling as the company’s CEO. Willie Walsh later replaced Rod Eddington and steered the merger process. The airline sold its Qantas stake in 2004. BA and lberia made public a merger plan in 2010. BA stopped trading in London Stock Exchange in 2011. The alliance between BA and lberia emerged third largest airline group globally. In Europe, it was second biggest airline group. Brief History of lberia From 1944 to 2001, lberia remained nationalized. After privatization on April, 2001, lberia joined stock markets and was integrated in the IBEX-35 stock index of the Madrid Stock Exchange. The privatization lasted up to 2009 after which the airline formed a merger with British Airways in 2010, which gave birth to International Airlines Group. Under the merger, each airline retained its original brand.