British Airways (BA) and Iberia Airlines are about to finalize a merger agreement, which would help in streamlining the cargo haulage via airfreight.

The two flight operators are looking to strengthen their businesses after the recession affected them, which caused lower cargo and passenger numbers.

The merger will give birth to a new company, Topco, which will stand in competition with Lufthansa and Air France-KLM as one of the largest airlines on the continent. The airline is expected to earn € 400 million in five years duration.

In an interaction with the Reuters, BA chief executive Willie Walsh said, “The merger will create a strong European airline well able to compete in the 21st century. Both airlines will retain their brands and heritage while achieving significant synergies as a combined force.”

The Iberia Airlines chairman, Mr. Antonio Vazquez said that air freight traffic for the group had declined by 19.3% during the first nine months of this year, although the decline was decreased by 8.6% tones per kilometer in the third quarter.