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BA buys stake in Spanish airline

Wednesday 28 October 1998 00:02 GMT
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BRITISH AIRWAYS said last night that it had agreed terms to take a stake in Iberia, the Spanish carrier, but the airline declined to confirm a report suggesting the deal would cost between 42bn and 52bn pesetas.

"It would be inappropriate to discuss any figures or percentages prior to the proposals going to our board meeting next month," said a spokesman for BA.

"Bob Ayling [BA's chief executive] met officials of Iberia in Madrid," he said yesterday. "The talks were very positive and a tentative agreement was reached to take a minority stake."

He added that the proposed agreement would be submitted to the board at its next meeting on 13 November.

Earlier yesterday, the Spanish state holding company SEPI said the deal was for BA to buy a stake of between 8.2 and 9.1 per cent in Iberia, while American Airlines is to take a balancing stake to give the British and US airlines 10 per cent between them.

According to SEPI, the parties have also agreed on a valuation of 520- 580bn pesetas for the Spanish airline, which includes its stake in Amadeus, the airline reservations system.

The three airlines revealed proposals to link up in July 1997 as a prelude to Iberia's planned privatisation, which is now not expected before next May.

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