Here's more on the Times article:
Lufthansa allows due diligence on BMI; BA and Virgin sign confidentiality agreements - report
Lufthansa has given rival airlines permission to conduct due diligence on its BMI British Midland business, the online edition of The Times reported. The report did not directly attribute the claim, but cited a person close to Lufthansa, who said there are several options available. It is thought that Lufthansa’s options range from selling the UK-based regional airline outright, or integrating the business fully, the report said.
Virgin Atlantic and British Airways are thought to be among airlines to have inked confidentiality agreements relating to the sale process, the article continued.
Flybe, the regional airline, and international carriers from the US, the Middle East and the Far East are rumoured to have indicated their interest in acquiring certain BMI assets, the article said. BMI’s Heathrow airport slots are of particular interest, the item added.
Lufthansa, the listed German airline, acquired a 50% plus one share stake in BMI a couple of months ago, the article noted. It is thought that Lufthansa paid approximately GBP 230m (EUR 262m) for the stake. Lufthansa holds an 80% stake in BMI, with the remainder held by Scandinavian rival SAS.
Lufthansa refused to comment on BMI, the article said.
Industry insiders have conceded that British Airways would need to relinquish up to 50% of BMI to secure regulatory clearance for a deal, the report continued. BA would be more likely to participate in a break-up of BMI, according to analysts cited by the report. The article estimated the possible price of a full takeover of BMI at up to GBP 500m.
Virgin Atlantic is thought to be planning to merge its own long-haul business with BMI, according to the website. Such a deal would, however, necessitate Virgin founder Richard Branson raising sufficient financing for an outright takeover of BMI, the report said.
People close to Lufthansa have said the airline has no interest in holding a stake in a merged BMI/Virgin, the item added.