Air Europa pull out of Iberia merger talks

After 80 days of merger talks behind closed doors, Majorca-based airline Air Europa has withdrawn from negotiations with Spanish state airline Iberia, less than two weeks after it was announced that a deal had been reached. The announcement was made by Air Europa's director general, Juan Sáez, last night. In a statement he said “we have concluded negotiations and we conclude that discrepancies regarding price, form of payment and guarantees for the integration of our staff cannot be resolved satisfactorily.” Sources for Iberia said that the airline had nothing to add to the Air Europa statement, only that the airline had asked for talks to be prolonged until April “it appears that they (Air Europa) could not wait.” Despite the break down in merger talks, Iberia said that it will continue with its growth and expansion programme. The proposed merger had caused concern in the Balearics and earlier this month, in response to reports that a deal had been reached, the Balearic government said that it feared inter island and flights to the mainland being monopolised by the new airline, which would have negative consequences for consumers. The chairman of Air Europa, Juan José Hidalgo, said in Palma last night that its was Iberia's “indecision” which led to the collapse of merger talks. “There is a limit to my patience,” Hidalgo said, adding that he is “quite calm” about the official announcement.