Remember this is all being driven by IAG, not BA. Current IAG CEO Luis Gallego was originally CEO of Iberia Express, which probably points to the likely outcome.
I really don't see how much there is to be saved at LGW. The cost base has been reviewed countless times. I think some ground handling was outsourced to Swissport and then brought back in house to a separate company.
Creating a separate brand and AOC will all add extra cost and complexity.