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. Last Updated: 07/27/2016

BA Courts KLM

LONDON -- British Airways is due shortly to hold takeover talks with Dutch carrier KLM in a bid to create Europe's biggest airline and the fifth-biggest in the world, The Observer reported Saturday.

The Observer said a senior airline source confirmed that BA was seeking to take a stake in KLM and added that a full merger was on the horizon.

KLM this week denied it was in talks with BA after press reports suggested BA was set to take a stake.

Previous talks over a merger failed in 1992, and a further informal approach by BA two or three years ago was rebuffed because KLM was about to link with Alitalia, the newspaper said.