Keeping / Selling bmibaby
I don't know the profit numbers for bmibaby - and I suspect that even if I got hold of the audited numbers, the accounting policies in place could easily be used to move profit recognition between the parent bmi group, bmibaby and any other subsidiaries pretty much at will. It's not a plc, so should not be particularly difficult for a competent finance director to achieve this. One therefore probably needs to be an insider to get a real picture of bmibaby's profitability as distinct from the bmi parent group.
Having said all that, there are potential reasons for LH wanting to sell on bmibaby - pretty much the same as BA declining to purchase BMed a while ago.
bmibaby has a fleet of 20 737s, most of which I believe are owned rather than leased, average age about 13 years. The resale market right now ain't great, but this represents a chunky amount of cash tied up in metal. Further, any company needs some capital to keep the business running - pay the fuel and wages, etc....
Suppose (as an example) this represents 100 mn pounds of capital, and that bmibaby currently makes profit of 1 mn per year. Suppose that LH management reckon they can tweak this to become 2.5 mn per year. This means that for every pound invested in the airline, at best you get an annual return of 2.5% - seems pretty lousy to me.
Instead, sell the subsidiary (or parts which don't give a good return on capital employed), free up the capital and use it elsewhere, as cash deposit in the bank (rainy day reserves in case the credit crunch turns nasty), to fund another part of the business - e.g. Austrian or Scandinavian