Im sure if BMIbaby had been LGW based
To be honest, given that fact, then Baby probably would have been integrated. They would have bought their own capacity to one of the two airports that BA operates from thus making integration into the core business easy.
They don't.
IAG wanted the slots so they can slowly be converted to profitablt LH slots. Filling up those slots with creaky 73's to destinations that don't feed the LH route structure would be a business disaster.
Nothing to do with MSL 'threats' or 'BA Express' threats, IAG can set up any airline under any AOC they wish, BA pilots or BALPA would have absoloutly no power to stop them, that lesson was learnt under the Openskies dispute.
Purely business. Return profit to the shareholders.
As to the commands, BMI crews have been given 1 command in 100 to satisfy Tupe under future aspirations. As the conversion of SH slots to LH slots will, on average, increase crewing thus commands by 4-5 crews per slot the overall benefit to BA crews will be a net increase in available commands. Something that was looking increasingly difficult in a slot constrained LHR.
Better to plan for the future than end up withering on the vine like a certain dispute ended in recently eh Count?