Virgin Atlantic founder calls on regulators to reject British Airways merger

Virgin Atlantic’s celebrity founder, Sir Richard Branson, has again issued a strongly-worded appeal to regulators in the US and Europe in order to discourage them from approving a historic deal that would see British Airways and American Airlines function as a single carrier on all transatlantic flights between Europe and the US. Branson published a column in today’s Telegraph in which he urged regulators not to be “fooled into thinking British Airways is poor and needs propping up.” Branson specifically pointed to the fact that the United Kingdom’s flag carrier turned a handsome pre-tax profit of £883 million and that it likely has about £2 billion set aside as part of a cash reserve.

Branson implied that BA has enjoyed many opportunities and gifts in the past that some of its competitors could only dream of, such as the legendary Concorde or a state of the art terminal at Heathrow all for itself. Virgin’s founder noted that all airlines are going through very challenging times and reminded readers and regulators that Zoom, Eos, Maxjet and Silverjet all went bankrupt this year due to high oil prices and the fact that they never received a helpful hand from state authorities. These carriers never “produced a begging bowl,” as Branson believes that British Airways is now doing, in its efforts to convince regulators to accept the merger with American Airlines due to tough economic circumstances.

Branson has sounded the alarms, noting that a BA merger with American Airlines would result in a monopoly on a number of transatlantic routes. For example, the combined firm would control 79 percent of the market on the London-Heathrow to Boston route and 66 percent of flights from the London to Chicago.

Source : Telegraph

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