Considering that presuming all is still on track, there is a deafening silence around the BA/Iberia merger which, if on schedule, is just a week away. It's as if its creators would rather that analysts, staff and customers just didn't notice it. It has progressed this far almost unchallenged. At BA's AGM questionners were far more concerned about whether cabin crew should be asked/told to work harder/cheaper/differently than whether they liked any or all of the aspects of the merger. Board members arrayed across the stage were happy to leave it that way and do nothing to encourage any sort of debate on the subject.
Neither the aviation press nor the usually excitable British media rushing to get out of their prams on the slightest half pretext have been shouting about the fact that IAG, BA and Iberia's Spanish registered new owner,while comfortably headquartered in the UK, will not be paying its taxes to HM Treasury but to Spain. BA's Chairman has been clear about the tax advantages of so doing. Financially therefore next week the core company moves offshore.Usually that would arouse at least some attention and shouts of "unfair, offside, how could they do that?" etc but in this case again silence.
The vast majority BA and Iberia shareholders seem to have no idea what their shares will be worth when exchanged for new IAG replacements or even the formula. No wonder the Board looked pleased when they eventually filed off to lunch . A long morning but not so much as a popgun in the potential armory ranged aainst them when they filed in. No need for flak jackets to survive,- just a low boredom threshold and lots of patience. The lack of knowledge about a formula makes decisions on whether to buy or sell right now very difficult.One wonders what has driven the recent rise in share value to around the £ 3 mark. Who is reading what tealeaves?
Credit where credit is due. Wille Walsh and Martin Broughton have steered this stealth merger with great skill. The so called analysts have enthusiastically bought any argument that " a bigger grouping is better/inevitable". Lufthansa have interestingly taken a different, more self interested and focused, path of both being a leading member of Star while growing their own position through the purchase of other airlines . In the BA case ,- which will be a fascinating potential business school study for years to come,- nobody has so far questioned the series of strategic miscalculations which have allowed the once very dominant company to have its position as the world's largest international airline with the most extensive global network to be eroded via a naive belief in the warm fuzzy aspects of alliances. It may be that the Government's decision not to further develop Heathrow or any other runway capacity in the London area, coupled with other travel unfriendly decisions such as to raise Air Passenger Duty through the roof is read as one to withdraw from the big league of air commerce but simultaneously milking its legacy to death while the supremacy of London/Heathrow/UK and BA are allowed to erode.In this case a shrugged acceptance that to see BA slide away into a larger foreign owned conglomerate could be seen as selling at the top of the market/while the going's good does make shrewd financial sense. In fact it's probably the only way it can be seen as that and in the long term national interest. If UK civil aviation, currently one of its most successful growth industries,has been selected to follow the shipyards, car manufacturing and a host of other once leading industries onto the downhill slope of decline, then the peak is the right time to offload it while the going's good. Is that what we really want though? Has anybody really thought about it? Where's the promised new joined up thinking and business orientation? Whatever happens now though is too late for BA. The stealth galleon is inside the harbour walls and about to dock.
