British Airways said it has decided to join a group bidding for Spanish airline Iberia led by private equity firm Texas Pacific Group.

TPG and its partners have already made an indicative bid worth EUR3.4 billion (HK$35.85 billion) for Iberia, or EUR3.60 per share.

"British Airways has joined with TPG Capital, Vista Capital, Inversiones Ibersuizas and Quercus Equity to investigate a possible consortium offer for Iberia," BA said on May 22. "If a bid were successful, Iberia would remain in Spanish control, and the Spanish investors would put in more than 50 percent of the total capital investment," said a spokeswoman for BA, which already owns 10 percent of Iberia.

Without Spanish control, Iberia would have to renegotiate airport landing deals with Latin American states, on which its most sought-after routes are based.

"Our stake in Iberia has been very beneficial to BA, and we'd anticipate that continuing," added the spokeswoman. "But we're exploring our options and haven't ruled out anything, including disposing of the stake."

TPG founder David Bonderman is no stranger to airlines as chairman of Irish budget carrier Ryanair and as the man behind takeovers of Continental Airlines in the 1990s and the catering arm of defunct carrier Swissair in 2002.

BA said there was no guarantee a formal bid would be made, but it ruled out making any further investment of its own in Iberia and said it would not make any independent bid for the carrier.

A bid is not expected until due diligence finishes in two or three months. Iberia is expected to open its books to the consortium any time from now, a source close to the deal said.