Delta and Virgin confident of approval for tie-up
Delta and Virgin are confident their proposed joint venture will get approval from European and US competition authorities.
Delta has confirmed it wants to buy Singapore Airline’s 49% stake in Virgin Atlantic for $360 million.
Virgin Group and Sir Richard Branson will retain the majority 51% stake and say Virgin Atlantic will retain its brand and operating certificate.
Under the proposed deal, the two airlines will share the costs and revenues from all joint venture flights.
At a press conference, the two airlines said there were significant precedents around the world where airline alliances had won approval from competition authorities, including the trans-Atlantic tie-up between rivals British Airways and American Airlines.
Delta CEO Richard Anderson said: "Now you will have a competing alliance, the second immunised joint venture between the US and the UK. It is great for consumers," he said.
He rebuffed comments by IAG chief executive Willie Walsh that Delta would eventually obliterate the Virgin brand.
"That atually gets my blood boiled a little bit," he said.
"Virgin has an iconic brand and the number one business product on trans-Atlantic routes. The whole purpose is to join the networks and the brands together."
Dismissing Walsh’s comments, he added: "I don’t know what the English term is for it, but we have a term in Texas!"
This is what else the airlines had to say:
On job losses: Whilst we can never rule anything out, there are no planned redundancies as a result of this.
On management: There will not be a shake-up of management. Instead, the joint venture will operate through a series of joint working groups on areas identified for collaboration, such as network planning, revenue management, sales, operations, etc. These working groups will comprise relevant experts from Delta and Virgin.
On Heathrow: Long term, both airlines will be based at Terminal 3 where Virgin Atlantic currently operates.
On corporate accounts: Corporate sales teams will work together and Virgin will be included in Delta’s corporate deals "almost instantaneously".
On AIr France/KLM: Our partners Air France/KLM have expressed strong support and we will work together over time to increase co-operation.
by Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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