Branson attacks BA for merger plan; In association with Chadwick Lawrence

Huddersfield Daily Examiner (Huddersfield, England), August 11, 2008

Byline: By HENRYK ZIENTEK Business Reporter

TYCOON Sir Richard Branson has written to both US presidential hopefuls, warning against allowing a merger between British Airways and American Airlines.

The boss of airline Virgin Atlantic claimed such as deal would damage competition on transatlantic routes.

Reports say BA would be prepared to sacrifice "hundreds" of transatlantic flights to allow the deal to go ahead. BA has tried to secure a pact with its US rival twice before, but has previously refused to meet US regulators' demands that it give up a large number of flight slots.

In a letter to US senators Barack Obama and John McCain, Sir Richard said that the solution to the problems of airlines "should not lie in an anti-competitive agreement which will inevitably lead to less competition and higher fares".

He wrote: "BA/AA would have a combination of high frequencies and a transatlantic network that could not be replicated by any other airline/alliance, and which would make it impossible for other carriers to compete for time-sensitive corporate or business travellers."

BA's negotiations with American Airlines are taking place alongside talks between BA and the Spanish airline Iberia about a possible merger.

BA suffered an 88% drop in profits between April and June and said the industry faced its worst-ever period.

CAPTION(S):

DAMAGE: Sir Richard Branson hits out at BA