British Airways in talks to merge with Quantas

British Airways is in talks to create a global airline by merging with Qantas.

British Airways is in talks to create a global airline by merging with Qantas.

The airline has confirmed it is discussing a possible merger with Qantas but said there is no guarantee it will happen. Its merger talks with Spanish carrier Iberia are continuing.

The airline said it is too early to say how the merger and subsequent restructure would be carried out. Part of the restructuring work could involve integrating the two company's IT systems.

An airline industry source said the airlines would be unlikely to merge their IT systems, but would probably continue to run them independently. "They are both too big to integrate their systems," he said.

Robert Morgan, consultant at consultancy Hamilton Bailey, said there are very few common systems in the airline industry.

"It will be a huge task for any airlines to merge systems. This is because many have developed them in their own way."

BA's share price rose from 17.4p to 157.1p yesterday in response to the news. Under the plans, the merged company would be dual listed in London and Sydney and both brands would remain.

Merging with Qantas would open new routes to each carrier, enabling BA to explore opportunities in places such as Asia that would be difficult to do alone, chief executive Willie Walsh said. BA has been affected by the recent economic troubles with profits hit by falling passenger numbers and high oil prices.

The airline said in a statement, "British Airways confirms that it is exploring a potential merger with Qantas Airways Limited via a dual-listed company structure.

"The discussions between British Airways and Iberia are continuing.

"There is no guarantee that any transaction will be forthcoming and a further announcement will be made in due course, if appropriate."

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