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British Airways trades for last time ahead of merger


British Airways (BA) will trade on the London stock market for the last time Thursday before its merger with Spanish carrier Iberia, it was confirmed here.

The merger will complete Friday and shares in the new holding company, International Consolidated Airlines Group (IAG), will be listed on stock market in London and Madrid on Monday morning, the Airline said.

The completion of the merger comes nearly 24 years after British Airways joined the London stock market in a high profile flotation that was 11-times oversubscribed.

BA and Iberia will retain their brands as part of the initiative that is expected to save 400 million euro (337.3 million pounds) a year by its fifth year.

The new airline group will have 419 aircraft flying to 205 destinations and will be Europe’s second biggest airline by market value after Lufthansa.

BA will also benefit through Iberia’s strong presence in South America, where BA operates only a handful of routes, aviation experts said.

The newly formed group plans to aggressively expand through further acquisitions and has already drawn up a list of 12 companies it is interested in buying.

Willie Walsh will step down as chief executive of BA to take up the same role at IAG in a move that will see his basic pay increase 12 percent from 735, 000 pounds to 825,000 pounds a year.

He could pick up a potential cash-and-shares annual bonus of up to 1.65 million pounds if he exceeds performance targets, capped at 200 percent of base salary, the experts added.

BA was floated on the stock market on February 11, 1987 at a price of 125 pence.

Its shares reached a peak of 760 pence on May 16 1997 after pre-tax profits reached 640 million pounds in the year to March 1997.

Their lowest point, at 86 pence, came on March 12, 2003 after its pre-tax profits slumped to 135 million pounds.
It was also the same year in which Concorde made its last commercial flight.

Shares were yesterday trading at around 293 pence.

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KUNA is the Kuwait News Agency

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