International Airlines Group, created from British Airways and Iberia, started its first day of trading on Monday in London even as BA’s cabin crew votes overwhelmingly in favour of strike once again.
International Consolidated Airlines Group (IAG), formed after the merger of British Airways and Iberia, made its stock-market debut today at 0800 GMT at a valuation of £6.1 billion (7.2 billion euros, $9.7 billion). At the start of the trading on London’s FTSE 100 index, IAG was up at 285.1 pence, a slight increase over BA’s final price of 282.5 pence.
With this new development, British Airways has ended almost a quarter of a century of trading on the stock exchange. From today, the company’s shares will be traded under the name of International Airlines Group. IAG shares will have their main listing in London with its earning being reported in euros. The company will also be listed in Madrid.
The two carriers have retained their brands as part of the deal, which has created Europe’s second biggest airline by valuation behind Lufthansa, flag carrier of Germany. Both the partner airlines are also expected to save 400 million euros a year by its fifth year of collaboration.
IAG will have a fleet of more than 400 aircrafts at its disposal with the total passenger traveltraffic estimated at over 60 million people each year. The airline group will operate flights to more than 200 destinations around the world.
The two airlines complement each other quite well when it comes to long-haul flights. While the British Airways strength lies on the North Atlantic, Iberia has strong presence between Europe and Latin America. Additionally, the anti-trust immunity awarded recently to Iberia and BA along with American Airlines for their transatlantic business is sure to benefit the group.
IAG has aggressive plans to expand further through acquisitions and has marked down 12 companies it wants to buy. Willie Walsh, who steps down as chief executive of BA to take up similar role at the International Consolidated Airline Group, is convinced that this grand merger of two carriers will provide a launch pad for even greater things.
In a related but less pleasant news for BA, the cabin crew of the company voted overwhelmingly in favour of further strikes in their dispute with the company, jeopardising travel plans of those travellers who have painstakingly booked tickets on cheap flights for Easter holidays.
British Airways’ Crew Votes for More Strike
British Airways’ cabin crew voted to strike again as the battle between the airline and its staff continues. Unite, the union representing the cabin crew however did not announce the strike dates as it fears waning public sympathy. Any fresh strikes could affect holiday plans of those who grabbed cheap tickets on flights for the long Bank Holiday weekends of Easter as well as the Royal Wedding in the later part of April.
5,751 staff members (78.5%) of valid voters supported the prospect of further strikes while 1,579 members (21.5%) are not in favour of the more strikes. Unite’s General Secretary-designate Len McCluskey observed that it was the fourth time in little over an year when the BA’s cabin crew have shown overwhelming support for their union.
“Surely BA management must now wake up and listen to the voice of their skilled and dedicated employees,” Mr. McCluskey was quoted by the internet sources. He also appealed to the airline for negotiations instead of turning to the courts.
However, BA disputed the numbers as well as the union claims. The airline said, “of our 13,500 crew, only 43% voted in favour of strike action in this ballot”.
“It is clear from this ballot result that Unite does not have the support of the majority of our cabin crew,” the airline said in a statement.
“Unite has lost about 2,500 cabin crew members since this dispute started, as crew have voted with their feet. Even with a smaller membership, the proportion of Unite members supporting disruption continues to fall, contrary to the union’s claims.
“We urge Unite to return to the deal we negotiated, which guarantees pay rises for the next two years and secures terms and conditions for our existing crew that are the best in the UK industry,” British Airways said in the release.
BA insists that in the event of a strike, ticket holders will not be hassled and it will be able to operate usual timetables from the London Gatwick Airport and City airports as well as all long-haul and several short-haul flights from Heathrow.