This keeps coming up...!
In previous versions of this discussion, I've warned that any 'merger' between Virgin and BMI would in fact be a takeover of BMI by Virgin. I maintain that position.
Any such merger is unlikely to work in BMI's favour. It is highly likely that the company would be divested of non-core business in the way that CaptJ suggests, and that only the most profitable mainline routes (and a proportionate - i.e. minimal - number of employees) would be absorbed into Virgin's structure. Virgin has no interest in operating short haul just for the sake of it - however much such a 'synergy' appeals to those inexpert observers who see Virgin's raison d'etre as being a competitor to BA in all its markets. It ain't so! Virgin's real interest in BMI is their slots at Heathrow, and nothing else.
In all cases of planned company takeovers that I can recall, there is evidence, well before the fact, of the subject company making itself more attractive to potential suitors by reducing debt and costs and suchlike, and ridding itself of elements of its business which are unlikely to fit in with those suitors. I see no such activity at BMI. In fact, it would be fair to say (from current employees' remarks) that there is little evidence of action of any kind from BMI to either improve its chances of survival, or to prepare itself for sale!
The BMI Caribbean routes from Manchester are reliant on Virgin Holidays contracts, which went to BMI because VS could not provide equipment to operate those routes - though they were planned and slots had been bid for. At some point those contracts will eventually be flown by Virgin, whether there is a 'merger' with BMI or not.
The India-UK market is potentially large enough to provide both BMI and Virgin (and many others) with lots of revenue. As the flights and operators are effectively determined by the two Governments, there is no reason for this market to be a bone of contention between the airlines at an operational level. As an aside, Virgin is apparently looking to operate to Bombay from February 2005.
Last edited by scroggs; 22nd Oct 2004 at 10:19.