BMed to be sold?
ATI is reporting that BMed is in discussion for the sale of a majority stake to a group of investors including a Lebanese firm (M1 Group) for STG30m, with the expectation that a proposal will be put to the existing BMed shareholders this month.
IIRC the standard BA franchise agreements provide for the franchise to lapse in the event that there's a change of control of the franchisee - I imagine there are some interesting discussions around that point at the moment, since BMed's value to an investor is very linked to its BA franchise (I'm not saying that it's got no value on its own - clearly it does, in terms of slots, fleet, etc., but losing the franchise would hit its revenue and hence the value of the firm). Whatever the current Waterside view on franchises, I'm not sure, pragmatically speaking, that BA mainline would be in a position to replace BMed in the short term, so I could imagine BA choosing not to terminate the franchise despite the change of control.
Any thoughts?
C.