London/Madrid - British Airways (BA) and Spanish national carrier Iberia said Thursday they were holding separate board meetings to discuss long-standing merger plans which could result in a "potential transaction."

But in statements released in London and Madrid, both airlines cautioned that no decisions had been taken and there could be "no guarantee" that a deal would be agreed.

Iberia revealed that the deal under discussion would give it 45 per cent of a new merged company, with the majority 55 per cent held by BA.

The two ailing European airlines have been considering a merger since the summer of 2008.

BA last week announced a record half-yearly pre-tax loss of 292 million pounds (485 million dollars), following a record annual loss of 401 million pounds in the previous financial year.

Iberia's recent results showed losses of 165 million euros for the first half of 2009.

Shares in both companies rose on the news on the stock markets in London and Madrid. (dpa)