Bay Capital Share Discussion Threads

[anony mous] 13/12/2010 22:34

British Airways in talks to cut pensions hole
Monday, December 13, 2010
Rob Gill

British Airways is reported to be in discussions which could almost halve its pension deficit of £1.9 billion.

The airline could reduce its pension shortfall thanks to new rules unveiled by the government last week which change the basis on which pensions are calculated for private businesses.

Under the plans, revealed by pensions minister Steve Webb, private firms can increase pensions in line with the Consumer Price Index, which is generally lower than the Retail Price Index that is currently used to work out pension payouts.

Another formerly privatised business, British Telecom, has already said it would make use of the law change to reduce its own pension deficit by £2.9 billion.

A similar move by BA could reduce the pension hole by around £900 million according to reports in The Financial Times.

BA agreed a deal with unions in March on pension scheme changes which helped to smooth the way for next month's merger with Iberia.

The Spanish carrier previously had the right to walk away from the deal if it felt BA's pension liabilities were too high.

BA has confirmed the pension discussions are ongoing, but did not comment further.

[anony mous] 13/12/2010 09:21

Yes, Enami.
..... but expecting much larger mkt cap as merger benefits feed through.

Should break out 3.00+ now, but before changeover anyway.

[jailbird] 13/12/2010 03:42

enami,

many thanks for that...that clears that up.

[alphorn] 11/12/2010 11:35

Could impact any future BAY borrowings:

[enami] 10/12/2010 09:28

jailbird you will get 1 IAG for 1 BAY share. Iberia shareholders will get 1.0205 IAG for each Iberia share. IAG will be the combined market cap of BAY and IB.

The details are in the shareholder circular



"On the basis of this Merger Ratio, following the IAG Merger, British Airways Ordinary Shareholders (other than Iberia) will hold approximately 56 per cent. of IAG and Iberia Shareholders (other than British Airways) will hold approximately 44 per cent. of IAG."

[jailbird] 10/12/2010 08:29

anony mous at all,

sorry if already asked..re : IAG shares are there any changes in the no. of shares in issue/the mkt cap afterwards.

Considering the enlarged Co. will also be producing bigger revenues and profits going forward.

[anony mous] 01/12/2010 14:59

merger benefits are only 'estimates' at the moment.

but as 'actual' figs come through next year and onwards, the share price will react.

Buxton owns a wee more than me of BA ;-)

[alphorn] 01/12/2010 14:02

AM - that does not make sense - the merger was as expected and in the share price but not any merger benefits?

[anony mous] 01/12/2010 13:58

Buxton sees 'material upside' in BA as investors agree merger
01 Dec 2010 | 11:30

Schroders' Richard Buxton believes British Airways shares have "material upside" as investors continue to underestimate the benefits of its merger with Iberia.

Buxton, who holds £72m worth of BA shares in his £2.25bn Schroder UK Alpha Plus fund, has held the stock throughout the airline's volatile recent past, which included a major slowdown in passenger numbers from the credit crisis and industrial action from cabin crew.

British Airways, which got overwhelming shareholder approval for its Iberia merger earlier this week, also posted a first profit in two years in Q3.
"Monday's outcome, with both BA and Iberia shareholders voting in favour of a merger, was completely as expected, so there should be little share price reaction," Buxton says.

"In the medium-term however, none of the benefits of the merger in cost and revenue synergies through co-ordinated routing are yet reflected in valuations. We are confident that there is still material upside in the shares."
Buxton is also bullish on British Airways' strategic tie-up with One World partner American Airlines, which the manager says is also not reflected in the share price."

[anony mous] 29/11/2010 21:41

Good info ;-)

[enami] 29/11/2010 17:32

zangdook - yes they will continue.

Extract from shareholder circular

"12. Shareholder discount scheme
Currently, private individual British Airways Ordinary Shareholders are eligible for a discount on certain British Airways flights if they hold more than 200 British Airways Ordinary Shares. It is expected that IAG will implement a shareholder discount scheme along similar lines. British Airways Ordinary Shareholders will be provided with more information on this scheme in due course."

The full circular with details of the timetable for the merger are here



6.00 p.m. on 20 January 2011 Scheme Record Time
20 January 2011 Last day of dealings in British Airways Ordinary Shares and Iberia Shares8
7.30 a.m. on 21 January 2011 Suspension of British Airways Ordinary Shares
8.30 a.m. (Madrid time) on 21 January 2011 Suspension of Iberia Shares
21 January 2011 Scheme Effective Date

8.00 a.m. on 24 January 2011 Expected date of Admission and commencement of dealings in IAG Shares on the London Stock Exchange

[zangdook] 29/11/2010 17:13

I wonder if the discount for holders of 200 shares will continue after 2011 (and thus be extended to ex-Iberia holders), and whether there will be (or is already) anything similar from Iberia.

[anony mous] 29/11/2010 14:28

29 November 2010
BA Iberia merger gets approval from shareholders

Shareholders of both British Airways and Spain's national carrier Iberia have approved the merger between the two companies.

Ninety-nine per cent of BA shareholders voted in favour of the deal, which has already been approved by the regulators.

British Airways shareholders will receive shares in the new company. This will be on a like-for- like basis so that if you own 100 BA shares now, for example, you will own 100 IAG shares on 24 January.

[ben nevis] 29/11/2010 13:52

Price came down :):) Was too high. Just short every bump !!

[ben nevis] 29/11/2010 13:50

Didnt matter anyway!! :):)

[alphorn] 29/11/2010 12:10

Little reaction to the vote but the merger was already in the share price
(Remain short).

[ben nevis] 29/11/2010 09:29

What time is today's big vote happening ? Can't find it.

[anony mous] 28/11/2010 19:18

BA and Iberia ready for £4bn lift-off with clearance from investors
The Observer, Sunday 28 November 2010

Decades ago flag carriers were jealously protected extensions of a nation's foreign policy. But Spain and Britain will enter a new era of aviation fraternity tomorrow when British Airways and Iberia shareholders are expected to back a £4bn merger.

Investors in both companies will hold extraordinary general meetings in London and Madrid to vote on the creation of a new superpower in the global market: International Airlines Group. IAG follows in the slipstream of Air France-KLM, created by the merger of the French and Dutch national carriers, and Germany's Lufthansa, which has gathered the Swiss and Austrian flags under its wings in recent years.

A BA spokeswoman said: "The industry is moving towards consolidation. This is an important step for both airlines." BA will retain its brand – and distinctive tailfin – if the merger goes ahead, with Iberia also maintaining a separate identity. BA's chief executive, Willie Walsh, will lead the combined, London-based group and has pledged to wring €400m (£339m) of cost savings from a combined fleet of more than 400 planes and a 57,000-strong workforce.

In the past BA's attempts to alter its identity have met stiff resistance, including a notorious attempt to alter its tailfins that drew the ire – and covering handkerchief – of Margaret Thatcher. But the headwinds of a global downturn and cut-throat competition have ensured that the creation of IAG has been largely unopposed. Even Sir Richard Branson, founder of arch-rival Virgin Atlantic, has ignored the deal and instead mounted a failed campaign to prevent a strategic tie-up between BA and American Airlines.

"In common with the rest of the industry, BA has struggled to deliver satisfactory returns to shareholders over the cycle," said Douglas McNeill, analyst at Charles Stanley Securities. "It has had some good years, but also some very poor ones. Consolidation can help by making it less likely that the industry will collectively invest in too much capacity." He warned that too many seats drive down prices and whittle away wafer-thin margins.

BA is expected to merge with Iberia with the threat of a looming new strike ballot by cabin crew. Tony Woodley, outgoing joint general secretary of the Unite trade union, has warned the organisation is close to staging another poll and is preparing to hold a news conference after the meetings.

[mark1000] 25/11/2010 12:42

But no talk of votes on strike action union are not sure they can win the vote presumably if they want to continue they will aim at disruption over the Christmas period if they duck calling for a strike over Christmas then presumably the dispute may rumble on but it will be toothless. Time will tell

[smicker] 25/11/2010 11:51

Walsh has made a mistake here reinstating perks at all. The unions scent the weakness and now hes back to square one.

[alphorn] 25/11/2010 11:46

Some rumbles in Iceland after a long period of low volcanic activity. Probably nothing.

[domtheone] 24/11/2010 16:41

Back in profit lol.

He don't mention the previous billion of losses then.

[alphorn] 24/11/2010 16:17

AM - For once I agree with you ;-)

[anony mous] 24/11/2010 16:13

LOL ! what a pratt Len is !



The new leader of Britain's biggest trade union, Len McCluskey, attacked the "culture of fear" at British Airways today as he launched a drive to discover the level of "bullying and harassment" against cabin crew.

"BA is back in healthy profit and its senior management have their pockets jingling with gold, so it's time they showed respect for our members.



........ is BA really back in healthy profit ?
........ whats with the jingling ?

[ben nevis] 23/11/2010 15:01

Shorting in the morning. Day at the sea. Cashing in at teatime :)