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UPDATE 1-EU to rule on BA, Iberia merger by July 15
June 11, 2010 / 3:16 PM / in 7 years

UPDATE 1-EU to rule on BA, Iberia merger by July 15

* European Commission could allow or block merger

* Could seek concessions such as ceding airport slots

* EasyJet says merger won’t change competitive landscape

* BA shares up 2.2 pct, Iberia up 1.9 pct, market up 0.5 pct

(Adds easyJet comment, shares)

BRUSSELS, June 11 (Reuters) - EU competition regulators will decide by July 15 whether to allow a planned $8 billion merger between British Airways BAY.L and Spain’s Iberia IBLA.MC, a deal that would create the world’s third-largest airline.

The European Commission could also ask the carriers, which notified European Union regulators of their plans the previous day, to provide concessions -- such as giving up airport slots -- to ease possible concerns the deal may damage competition.

The airlines aim to complete the merger by December and hope it will enable them to compete better with rivals Lufthansa (LHAG.DE) and Air France (AIRF.PA) as well as low-cost carrier Ryanair (RYA.I). It will also clear the way for a tie-up with American Airlines AMR.N. The EU executive is reviewing the three airlines’ plan to deepen their OneWorld alliance, with a decision expected by the end of July.

The Commission, competition watchdog of the 27-country EU, is expected to seek views from customers and rivals on the BA-Iberia merger. It can extend its review by 35 working days if it has concerns or if the two carriers offer concessions.

British budget airline easyJet (EZJ.L), which competes with the carriers on some routes between Spain and Britain, said on Friday it had received a questionnaire from the Commission and saw no competition concerns.

“For us the planned merger won’t much change the competitive landscape, the deal is perhaps more to do with long haul rather than short, and we’ll continue with our expansion,” easyJet said in a statement. BA shares were up 2.2 percent and Iberia 1.9 percent higher by 1449 GMT, outperforming a 0.5 percent gain in the Stoxx Europe 600 travel and leisure index .SXTP. (Reporting by Foo Yun Chee, editing by Dale Hudson)

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