Newspaper article The Evening Standard (London, England)

Out-of-Favour British Airways Is Relegated from the FTSE 100

Newspaper article The Evening Standard (London, England)

Out-of-Favour British Airways Is Relegated from the FTSE 100

Article excerpt

Byline: JONATHAN PRYNN

BRITISH AIRWAYS - one of only a handful of globally known and respected UK companies - will today drop out of the FTSE 100 index of the biggest blue-chip firms for the first time.

The company's fall out of the prestigious list will be confirmed after nervous and dramatic trading in the stock market yesterday saw Britain's flagcarrier teeter on the brink of the FTSE 100 relegation zone until the last few minutes of dealing, when BA shares slipped 1/2p right at the death.

Traders said it was the tightest relegation call they could remember.

ABN Amro analyst Guy Fisher said: "It was very close this time round for BA.

It's going to be a while before they make it back in."

BA's ejection will be confirmed today on the anniversary of the 11 September attacks that had such a devastating impact on the world's aviation industry.

BA's shares fell 21 per cent to 208p a year ago, compared with last night's closing price of 135p.

BA's chief executive Rod Eddington said the company had initiated a huge cost cutting effort to help survive the current tough trading conditions. He said: "I have never tried to hide behind 9/11. What we have been doing is reacting to how things have been changed by the no-frills airlines."

The last-minute drop in the share price left BA as the 111th biggest company in the London stock market, valued at [pound]1.461 billion, just [pound]4 million below the 110th ranked company, the technology group Arm Holdings.

Under the FTSE 100 rules, any company ranked below 110 at the time of the quarterly shake-up is automatically thrown out of the index of top companies.

The relegation will be officially confirmed later today. Two other companies, music giant EMI and electricity generator International Power, are also certain to be kicked out.

Although BA insiders put a brave face on the loss of FTSE 100 status, there will be immense disappointment that the company is no longer listed with the top bluechips. …

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