British Airways Keen to Join Consolidation

British Airways wants to take part in global consolidation but expects regulatory hurdles to hinder cross-border deals, Chief Executive Willie Walsh said on Thursday.

Separately, chief executives of American Airlines and Finnair anticipated more fund-led buyouts in the industry after Australia’s Qantas agreed to an $8.7 billion takeover by a consortium including Macquarie Bank.

The global airline sector has seen a wave of consolidation attempts, such as a failed bid by US Airways Group for Delta Air Lines and merger talks between United Airlines and Continental Airlines.

Heavy international regulation, over-capacity in some regions, rising fuel prices and terrorism have all undermined earnings and driven several airlines into bankruptcy in recent years.

BusinessWeek magazine reported last month that American Airlines parent AMR may be a buyout target by a group including British Airways and Goldman Sachs, although sources familiar with the matter said the two parties had no current plans to bid for the American Airlines parent.

Analysts viewed the reported scenario as unlikely because it would face close anti-trust scrutiny and restrictions on foreign ownership, while strong unions are also seen limiting successful cross-border deals.