BA Holder Not Deterred By Lower Stake In Iberia Merger
February 26 2009 - 1:31PM
Dow Jones News
British Airways PLC's (BAY.LN) largest institutional shareholder
Standard Life Investment Thursday said it wouldn't be deterred by
the airline accepting a lower stake in a merged company with Iberia
Lineas Aereas de Espana SA (IBLA.MC).
Helen Driver, fund manager at Standard Life Investment, said she
would prefer BA taking a higher proportion in the merged entity but
if the cost saving is sufficient, then a smaller stake would still
be acceptable.
When BA originally announced the deal with Iberia in July, it
was expected that the U.K. flag carrier would take a 65% to 70%
stake in the resulting holding. However, recently, Iberia has
surpassed BA in terms of market capitalization, which has forced
the Spanish airline's main shareholder Caja Madrid to press for a
bigger stake.
Recent Spanish media reports have suggested BA would accept a
majority holding of 55%.
Driver said that she didn't think BA's current share price has
factored in a merger, adding that the current share price indicated
"it wasn't expecting (the merger) to happen."
Company Web site: www.britishairways.com ; www.iberia.es
-By Kaveri Niththyananthan, Dow Jones Newswires; 4420 7842 9299;
kaveri.niththyananthan@dowjones.com
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