PROPOSED SALE OF BA CONNECT TO FLYBE

British Airways announced today that it has reached agreement in principle to
sell the regional operation of its subsidiary airline BA Connect to Flybe.

BA Connect also operates from London City Airport and between Manchester and New
York. These services will not form part of the proposed sale nor will the
regional ground handling business, British Airways Regional Ltd.

Willie Walsh, British Airways chief executive said: 'Point to point regional
operations are not a strategic part of our business and we believe that such
activities are better undertaken by a regional low cost airline.

'Despite the best efforts of the entire team at BA Connect, we do not see any
prospect of profitability in its current form.

'The proposed sale to Flybe provides the best opportunity to secure the
long-term future for the many dedicated staff in BA Connect. British Airways
will have a 15 per cent investment in Flybe on completion of the disposal.

'London City services complement our mainline business at Heathrow. For this
reason they are not included in the proposed sale.'

It is envisaged that once the sale of the regional business of BA Connect to
Flybe is completed, there will be a transition period until the start of the
summer schedule on March 25, 2007 while the handover of responsibilities is
undertaken.