BA wins battle to acquire bmi from Lufthansa

Discussion in 'Miles & More | Lufthansa, SWISS, Austrian/Partners' started by garyst16, Dec 26, 2011.  |  Print Topic

  1. garyst16
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    garyst16 Silver Member

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    By Jim Glab (

    Lufthansa announced that it has signed a binding agreement to sell its British Midland Ltd. subsidiary, which operates as bmi, for $271 million to International Airlines Group – the parent of British Airways and Iberia.

    The sale had been bitterly opposed by Virgin Atlantic, which had also been discussing a possible purchase with the German carrier. The real plum among bmi’s assets is its collection of dozens of takeoff and landing slots at London Heathrow. The airport is operating at full capacity, so any airline that wants to expand there has to acquire slots from carriers already operating there.

    Lufthansa noted that the sale “remains subject in particular to competition clearance,” something that could be an issue. BA and Iberia currently hold just over 44 percent of the slots at LHR, and the addition of bmi’s 8.5 percent would give International Airlines Group control of more than half the slots at the congested airport – something competition regulators might object to.

    Virgin Atlantic chief Sir Richard Branson said the transfer of bmi’s slots to BA and its parent “just tightens their stranglehold” at the busy airport.

    BA chief Willie Walsh told Bloomberg News in an interview that once the deal is cleared, British Airways will likely replace some of bmi’s regional services with new BA intercontinental flights, including additional services to China and the addition of new destinations like Korea and Vietnam.

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