British Airways¹ and Spanish airline Iberia have signed a deal to merge² and create one of the world's biggest airline groups.

英国航空公司与西班牙伊比利亚航空公司签署一项合并协议，该协议将缔造出一家世界最大的航空公司集团。

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BA has been considering a merger with Iberia for some time

The merger, which was provisionally（临时地，暂时地） agreed in November last year, is expected to be completed by the end of the year.

In a statement the two companies said the merger would benefit shareholders⁴, employees and customers.

It is expected to save the airlines 400m euros ($533m; £350m) a year.

The new company will be called International Airlines Group, but the BA and Iberia brands will continue to operate as normal.

The company will have its headquarters in London, with BA shareholders retaining（保留） 55% ownership of the company.

In total the group will operate 408 aircraft and carry more than 58 million passengers a year, the two companies said.

BA chief executive Willie Walsh said the merger would be good for customers.

"The merged⁵ company will provide customers with a larger combined network," he said.

Iberia's chairman and chief executive Antonio Vazquez said the merger was important for the future of the airline industry.

"This is an important step in the process towards creating one of the world's leading global airlines that will be better equipped to compete with other major airlines and participate in future industry consolidation⁶（产业联合） ," he said.

The merger is seen as a chance for the two airlines to cut costs following two very tough years for the airline industry.

Both BA and Iberia are expected to report heavy losses this year, with BA predicted to announce its biggest annual loss since privatisation（私有化，民营化） .

The airlines are also regarded as a good match, having few overlapping⁷（重叠，覆盖） routes.

The merger will also allow the company to compete more effectively with other European giants including Air France-KLM and Germany's Lufthansa.

The airlines are expected to complete the merger by December, subject to approval from regulators and shareholders.