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LONDON, NOV 29 - International Airlines Group said its transatlantic joint venture with American Airlines would continue to operate as normal after the U.S. carrier filed for bankruptcy protection.
American Airlines and its parent company AMR Corp filed for bankruptcy protection on Tuesday after failing to win a deal with pilots earlier this month to pare its labor costs.
“We have every confidence in the future of American Airlines. We are pleased they are taking this step which shows commitment and determination,” IAG said in a statement on Tuesday.
“Our joint business, which is a revenue sharing agreement, continues to operate as usual.”
American said the bankruptcy would have no direct legal impact on operations outside the United States and it was not considering debtor-in-possession financing.
“From a bookings perspective perhaps an airline in chapter 11 could be less attractive to consumers so sentiment could be hit,” said Stephen Furlong, an analyst at Davy Stockbrokers.
“I don’t think this will change IAG’s strategy though and American will continue to be an important part of its business.”
Shares in IAG, which have fallen 11 percent in the last three months, were 2 percent down at 141.7 pence by 1415 GMT, valuing the company at around 2.7 billion pounds ($4.20 billion).
AMR had been the only major U.S. carrier to avoid bankruptcy proceedings in the past decade, a move its rivals had used to restructure their labor agreements and cut costs.
Finland-based carrier Finnair, part of American Airlines’ oneworld alliance, said it was confident American would be able to pull through by lowering their cost base.
“I want to underline that all other American air carriers have already went through this process, so they are the last one here. They will continue their operations as usual, so the filing will not have an impact for their customers nor the oneworld cooperation which we have with them,” said Finnair spokeswoman Paivyt Tallqvist.
($1 = 0.6433 British pounds)
Reporting by Rhys Jones; Editing by Adveith Nair