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May 25 2012 13:58
The costs of the first phase of the Gauteng Freeway Improvement Project have increased significantly to almost R90bn, according to a report.
May 24 2012 17:31
The Reserve Bank will maintain current interest rates, and a considerable reduction in the local petrol price is anticipated, says governor Gill Marcus.
May 25 2012 11:36
The JSE has identified and stopped "incorrect" trades from one of its members, and will reverse the trades and lower the session's total value after the close.
London - British Airways PLC and Spanish airline Iberia SA confirmed they are holding separate board meetings on Thursday about a long-awaited merger, responding to feverish speculation that has sent the companies' shares soaring.
BA, the third largest airline in Europe, said the meetings would consider a "potential transaction" and that no deal has yet been reached. It declined to provide any further information.
The two airlines' shares surged on Thursday on speculation that a deal announcement is imminent, possibly on Friday, when Iberia announces financial results that are expected to show an operating loss over the first nine months of the year.
An announcement would end more than a year of difficult negotiations between BA and Iberia. The pair began talks about a possible tie-up back in July 2008 in response to slowing passenger demand, but discussions have faltered over issues including BA's large pension fund deficit and the proposed structure of a merged company.
Iberia also confirmed that the deal currently being discussed would give the Spanish airline 45% of the new company, with BA taking the remaining 55%.
Analysts view a merger - and a proposed revenue-sharing deal with American Airlines that is still facing antitrust barriers - as a necessary consolidation in the airline industry after rising fuel prices and the global economic downturn hit demand.
BA's stock closed 7.5 percent higher at 215 pence ($3.56) after reaching an intraday high of 222.7 pence, while Iberia shares jumped 11.8 percent to 2.22 ($3.30) in Madrid.
BA Chief Executive Willie Walsh has been among the most vocally pessimistic airline executives about the outlook for the sector, warning that the key premium market may never recover.
BA last week reported a net loss of £208m for the six months ending in September, its first-ever loss in the period, as revenue fell 13.7 percent.
The airline has begun a drastic cost-cutting drive, axing meal services on short-haul flights and announcing sweeping job cuts and pay curbs that have raised the threat of strike action by its 14 000 cabin crew. The airline has already slashed 2 500 positions between June 2008 and March 2009 and plans to cut another 1 700, freeze pay for current staff and offer lower wages for new employees.
- AP