British Airways Chairman Says Airline to Be Denationalized This Year
Mar. 17, 1986
LONDON (AP) _ The British government said Monday that the proposed sale of state-owned British Airways had not been postponed and would likely go ahead before April 1987, the end of the next financial year.
British Airways' chairman Lord King, after a meeting with Prime Minister Margaret Thatcher, denied a report in London's Guardian newspaper Saturday that claimed British Airways' executives planned a 1.4 billion pound ($2.1 billion) buyout bid for the national carrier early this week.
''We have not submitted a plan to the government ... for a management buy- out'' and no bid was being prepared, King told reporters after meeting with the prime minister.
King, seeking an assurance from Mrs. Thatcher that British Airways would be sold into private hands, described the half-hour meeting as ''very friendly, nice and constructive.''
Asked by reporters if he expected British Airways to be denationalized this year, he said: ''We expect it to be. I am sure it will be.''
Transport Secretary Nicholas Ridley said last Wednesday that government plans to sell British Airways to the private sector had been delayed because of legal problems in the United States.
Ridley said Monday that the Conservative government never said it intended to sell off British Airways this summer.
''I have not postponed the privatization of British Airways,'' Ridley told Parliament. ''The position before last week was that we hoped it would be possible to privatize it during the coming financial year. That is still the position.''
Ridley said he had no knowledge of a management bid for British Airways and its 34,000 staff.
''The mystery about this alleged management buyout proposal is that nobody at this time seems to know who suggested the idea,'' he said.
The government hopes to raise at least 1 billion pounds ($1.4 billion) by floating British Airways shares on the London Stock Exchange.
Although the airline's profitability has increased under King's management to the point that it could be sold, antitrust litigation arising from the 1982 collapse of Laker Airways has still not been settled.
British Airways is involved in a lawsuit alleging that the failure of the cut-price trans-Atlantic carrier was partly the result of a conspiracy among major airlines.
Ridley said last week he is talking with the U.S. government to secure for British airlines a ''fair and equal'' share of traffic between the two countries.
The government, in a bid to roll back state control, has already sold 12 other state companies in the past five years.
British Airways flies to 143 cities in 68 countries, carried 16 million passengers on scheduled flights last year, and 2 million others on charter flights.