LONDON - British Airways PLC and Spanish airline Iberia SA said late yesterday they have reached an agreement to form a new company in which BA would hold a controlling 55 percent.
The two companies, which together posted $22 billion in revenue last year, are calling the deal a planned merger.
In a joint statement, they referred to the combined group as TopCo and said it would be registered in Spain but have its financial headquarters in London. It would be listed on the London Stock Exchange, and might have a secondary listing in Madrid.
British Airways shareholders would hold 55 percent, while Iberia’s would have 45 percent.
They said they expected the deal to produce savings of around $594 million after five years. The deal should be completed in late 2010 but would still need approval of shareholders and regulators.
British Airway’s Willie Walsh would become chief executive of the new group, while Iberia CEO Antonio Vazquez would be chairman. The deal ended days of feverish speculation that has sent the companies’ shares soaring.