IN a move expected to see Cathay Pacific join a global alliance that will shake up the industry, British Airways yesterday confirmed it would announce tomorrow 'a major worldwide airline initiative'. BA and Cathay Pacific refused to confirm involvement by Cathay but the deal looks set to be announced at a London press conference to be held jointly by the British carrier and American Airlines. Cathay chairman Peter Sutch was not in Hong Kong yesterday and a spokesman declined to say where he was. The pact, which is also expected to include BA's 25-per-cent-owned Qantas Airlines and Canadian Airlines, is understood to be centred on a new inter-linking marketing structure that will allow each airline to tap into their rivals' customer database. Cathay spokesman Andy Herdman said the biggest advantages for customers of such a deal would be in the business travel sector, where passengers would find 'consistency of service', smooth travel arrangements and an improved frequent-flyer programme. Industry sources said the pooling of resources in such alliances also increased the choice of flights and improved airlines' ability to provide connections to non-hub destinations. The alliance would create one of the most formidable blocs in the industry, competing head-on with the Star Alliance, the world's biggest airline grouping, which includes Thai Airways, United Airlines of the US, Germany's Lufthansa, Sweden's SAS and Brazil's Varig. Cathay has been courted by several airlines this year and is the only large airline group which has no significant links with other airlines. A tie-up with BA and American Airlines would put it together with some of the strongest brands outside Asia. Mr Herdman said the airline had signalled its intentions of seeking an alliance and was 'close to finalising' the plans. He said Cathay had for some years been opposed to alliances, but the airline had recognised the industry trend towards such groupings. 'The growth of alliances is a reflection of how competitive a business it is,' he said. Cathay is regarded as a prize catch, because it will give BA and American Airlines, which are both seeking regulatory approval for a full-scale merger, an important leg into Asia, grouping them with one of the best-known carriers in the region, with an important link into the burgeoning mainland routes. Cathay's headquarters at Chek Lap Kok have also provided an important attraction. Sources said yesterday Cathay would also be expected to try to draft its partially owned Dragonair affiliate into the alliance, further cementing its presence in the region. The move would come as a boon to Cathay, which lost $175 million in the first six months of the year. The airline has become increasingly reliant on its Hong Kong-London routes, and a link-up with BA would boost both carriers' traffic between Hong Kong and London significantly, sources said.