I agree with jacksparra's post.
BMED was a smart move for bmi and despite more than a few teething problems, they are starting to make the mid-haul routes pay [a VERY important point]. Of course SMB with not say anything, we all agree that he is shrewd and by the nature of business it WILL go to the 11th hour before something [if anything] happens.
This year bmi have to prove to the industry that they are not all just spin/marketing and that they are able to support themselves without the European Agreement previously in place. [This is where profitable mid-haul routes come in!]
However, having spoken to VS people, I understand that VS are confident that things will work out their way.....supposedly to the point that they have discussed ways of levelling crew remuneration and even the implementation of a Y-shaped seniority list.
IMHO I think that a tie-up between the two would be healthy for the consumer, LHR and of course the staff! But, without knowing who will end up with SMB shares/Singapore's 49% in VS and what LH has in mind, I might suggest that VS are a little premature!
An interesting time for all........