KPMG STUDY CLAIMS AIRLINES ARE CIRCUMNAVIGATING MERGER RULES

A new study by KPMG has stated that airlines are circumnavigating strict merger rules by entering into partnerships that garner many of the benefits of merging without the legal restrictions. The report says that codeshare agreements, increased alliance participation, joint service agreements or strategic procurement partnerships are being used by airlines to work around restrictive international route rights rules and foreign ownership restrictions. “Consolidation in the global airline industry will increase as the pressures on costs and revenues in the present economic climate continue,” said Dr Ashley Steel KPMG’s global chair for transport. “The severe weather conditions in the UK