Virgin in talks with LH over future of bmi

[Beavis and Butthead]

Now there is a rumour .... true though. Being reported on BBC.

[Killigrew]

FFS ! What ever next?
I just want to know who (if anyone) will be paying my wages this time next year !
What a circus !:sad:

[mechelec]

SKY Breaking News:

Virgin Atlantic in discussion with Lufthansa "regarding the future of British Airline bmi"

Be interesting to watch the fall out on this one..!!:ugh:

[lexxity]

Well here we are another Wednesday...........

Funnily enough I was only discussing this rumour with a VS CC this morning.

It looks as though LH are going to be breaking the group up, so perhaps the rumours about Regional/Baby going to FlyBe might be true.

[Killigrew]

I mean, it's only peoples lives that they are messing with, here....
Just get it over and done with, so we know just what we're faced with !

[stansdead]

This news has been about for a while, at least as a strong rumour.

Good news I say. Bring it on.:)

[lexxity]

Just get it over and done with, so we know just what we're faced with !

Absolutely. :ok:

[SinBin]

It's just exploritory and speculation, don't panic just yet!

[ltn and beyond]

If Branson has money to spend, he said a while back he wanted to buy BMI, and is now in talks with LH over BMI,s future which would cost VS to have any input. Why does he not buy the 49% of VS that Singapore want to off load??. Is BMI a better investment than the rest of his own company ??

Is this yet again more "hot air" or a reaction to the BA/QF/IB/AA talks of merger?

[hetfield]

That's funny, yesterday evening I opened a thread with the same subject but it was deleted/moved somewhere pretty soon.

Strange.....

[Doodles]

Why does he not buy the 49% of VS that Singapore want to off load

Because it doesnt give him any more LHR slots?

[racedo]

[QUOTE][/Because it doesnt give him any more LHR slots?QUOTE]

Same conclusion.

Interest is more slots rather than having a benevolent view on BMI.

[ltn and beyond]

Good point about the slots!!. However as is the case with BMI being sold to LH, what would happen if the 49% share of VS if was sold to another carrier would this not risk the slots already held by VS and indeed any further growth plans they may have?. Or am i thinking i a too simplisitic way?.

Self preservation in the current climate must be as important as future growth.

[max zedeffdubya]

the beardrd one has only one persons interest at heart/HIS

[racedo]

what would happen if the 49% share of VS if was sold to another carrier would this not risk the slots already held by VS and indeed any further growth plans they may have?

Nothing as a 49% share in a private company where someone else holds 51% has no real power. No matter what you do you can always be outvoted.

[Dan Air 87]

Honestly this VS to buy bmi has been dragging on for such a long time that its becomig so boring. Why would LH want to sell to Beardie anyway? At the end of the day, will this improve the VS route network and more importantly the standard of services that are provided? My thoughts are with the people at bmi who must be fed up with the whole caper by now.

[Count von Altibar]

They have been in talks for some time, it has been reported in various business articles over the past year. Once SRB realised that SMB was leaving the stage they turned their attention to talks with Lufthansa. Ultimately it is their decision now as to what happens with bmi and that announcement is on the 15th Jan'09. We await their intentions...

[wobble2plank]

I love the 'slot' discussion when it falls to BMI's slots at Heathrow. Whilst any slot out of and into Heathrow is valuable, they only become valuable to long haul if you can sensibly tie them up with a useful slot at your major destination airport. Conversely the return slots need a sensible departure, boarding and check in time at the other end. There is no point using the slot out of Heathrow and then having to fly very slowly for 12 hours as you can't land until then at your destination.

All slots are not equal! Whilst some of BMI's slots could be converted a lot couldn't. LH and SH departures are biased towards the more lucrative LH slots with SH 'giving way' in terms of schedule.

I hope the future of BMI gets sorted soon as no one wants the worry at any time let alone over the festive season.

Good luck to all.

[Doodles]

All slots are not equal! Whilst some of BMI's slots could be converted a lot couldn't.

Don't totally disagree but there is also a monetary value that could be placed on slot rights (high at LHR whatever time) and then used in the asset column to bolster the balance sheet.

Also, once you have a slot you have something to bargain with. We all know LHR in particular has been a closed gang for years so again, not all slots are the same agreed , but any slot at LHR has potentially huge positives.

[NWSRG]

Is it not possible that a VS-BD tie-up would actually be beneficial for both sides? An established LH operator with a good reputation links up with an established SH operator with a good reputation...and you get a full range operator with a good reputation!

I'm not convinced this is about slots at LHR...maybe more about two airlines, who would be a good match for each other, getting together at an opportune time...and maybe a VS / BD / LH combination isn't too much a stretch of the imagination!

[Doodles]

Big time consolodation on a global scale is an absolute must for the future of the industry, so a three way tie up here could be a good start. Regulators everywhere need to get their heads out of the sand and let the market work out how one of the largest industries and employers on the planet can be allowed to make money. Airlines generally have some of the worst financial returns of any industry - the margins are horific, even in good times. Allow more foreign ownership, let mergers happen and lets get on with it.

Let the mergers commence - may mean some job losses in the short term and some names lost forever but ultimately it has to move forward.

Will this discussion on VS mean that RB stops bleating about how unfair any ties up between BA /AA and BA anyone else would be? I doubt it. Mergers - Jump in or fall out cause it has to happen.

[K.Whyjelly]

Lufthansa Keeps Open Mind On Virgin/BMI
http://i.cdn.turner.com/money/.element/img/1.0/branding/dj_logo.gif (http://www.dj.com/) December 11, 2008: 01:27 PM ET

CHICAGO -(Dow Jones)- Deutsche Lufthansa AG (LHA.XE) said Thursday that it is not in serious talks with Virgin Atlantic Airways Ltd. about potential cooperation over British Midland Airways Ltd., or bmi, in which the German airline is in the process of buying a majority stake.

But Lufthansa said it maintains an open mind about potential cooperation with Virgin Atlantic.
The German flag carrier also said it had the capacity to absorb more acquisitions and strategic stakes on top of the various ones it has made in Europe and the U.S. in recent months.
"From a management point of view, we can do much more," Wolfgang Mayrhuber, Lufthansa's chairman and chief executive, said at an industry event in Chicago.
Virgin Atlantic said Wednesday that it had held talks with Lufthansa about the future of bmi, which controls a number of slots at London's Heathrow Airport.
Expressions of interest in some sort of cooperation or tie-up between bmi and Virgin Atlantic have not led to serious negotiations, said Klaus Walther, Lufthansa's senior vice president corporate communications.
"We want to find out what [Virgin] wants," noted Walther. He said it would be "logical" to integrate bmi into the Lufthansa group, adding that "there are other options."
Lufthansa is set to lift its stake in bmi, which focuses on short- and medium- haul flights in Europe, from 30% minus one share to 80% next month.
Europe's second-largest carrier by traffic after Air France-KLM SA (3112.FR), Lufthansa recently has expanded through the acquisition of Swiss International Airlines and a 45% stake in Brussels Airlines, with a pending deal to take a 41.6% share in Austrian Airlines (AUA.VI). It has a 19% stake in JetBlue Airways Corp. (JBLU), a low-fare U.S. carrier.
Lufthansa has also been linked with taking a stake in SAS Scandinavian Airline Systems, and is keeping an eye on the restructuring of Italian flag carrier Alitalia (AZA.MI).
Mayrhuber said Lufthansa's model eschews outright mergers: "Our concept is a modular one. It's like a planetary system that works together."
He said complete integration brings "dis-synergies." Lufthansa prefers an approach he described as "one kitchen, several restaurants".
Nigel Turner, bmi's chief executive, declined to comment on the prospect of any deal with Virgin Atlantic.
-By Doug Cameron, Dow Jones Newswires; 312-750-4135; [email protected]
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http:// www.djnewsplus.com/al?rnd=OBSC4tG5tv93CjIHwO9G9A%3D%3D (http://www.djnewsplus.com/al?rnd=OBSC4tG5tv93CjIHwO9G9A%3D%3D). You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires
12-11-08 1327ET
Copyright (c) 2008 Dow Jones & Company, Inc.