British and Iberia to merge, create the International Airlines Group

British Airways (London) and Iberia (Madrid) today (April 8) signed an $8 billion merger to create the world’s third largest airline by revenue on Thursday, bringing the alliance with American Airlines (Dallas/Fort Worth) a step closer according to this Reuters report.

The combined group, to be majority owned by British shareholders, ends BA‘s long pursuit of Iberia and positions the companies for further consolidation. Designed in the same manner as the Air France-KLM merger, the two airlines have created a holding company named the International Airlines Group based in London.

Both carriers are expected to retain their individual brands but there will be some consolidation and a renewed focus on the long-haul routes.

Read the full report from Reuters: