Iberia could walk away from merger if pension plans not met

Iberia CEO, Antonio Vazquez, stated the carrier still has the option to walk away from its planned merger with British Airways if the UK pension regulatory authority does not agree to terms worked out between the carriers (Dow Jones, 07-Jun-2010). British Airways has a GBP3.7 billion pension debt. Iberia and British Airways signed an MoU earlier this year which allows Iberia to exit the merger agreement, at a EUR20 million penalty, if it feels the final plan for reducing the deficit would hurt the combined airline financially.