BMI
Assuming all the rumours about the EU agreeing to IAG buying bmi from Lufthansa are correct and Almunia doesn't throw something unexpected into the equation, when is the transaction likely to complete ? Or to put it another way, when will IAG pay LH the £172m, when do the current directors of bmi (WPS and co) resign and when does IAG nominate directors to the board of bmi and formally take control of bmi as a company ?
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Depends what other conditions to closing were included in the purchase agreement, but could be the same day if everything had been lined up ahead of time. Given that the parties seem in a hurry to get the deal done it would be surprising if it wasn't completed within days rather than weeks. Expect a statement from IAG/DLH on timing once the EC has issued their press release.
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The plan is for the 16th to be the day of handover. That hasn't changed despite the dely from the EU.
As to what happens to the board etc. no-one on here is likely to have a clue, or if they do, they certainly won't say.
As to what happens to the board etc. no-one on here is likely to have a clue, or if they do, they certainly won't say.
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16th April is 2 full working weeks from the end of today when you take Easter into account. This was the time stated it would take to finalise the deal subject to the green light today.
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Happyberks
I would concur with the 16th
The directors of bmi eg WPS, NT & so on all go across to IAG, what they then do with them is a matter for the IAG board.
The relevant companies involved will by now know the out come of the EU ruling allowing them time to prepare the press releases for this afternoon to be issued after the EU go public.
The directors of bmi eg WPS, NT & so on all go across to IAG, what they then do with them is a matter for the IAG board.
The relevant companies involved will by now know the out come of the EU ruling allowing them time to prepare the press releases for this afternoon to be issued after the EU go public.
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And speaking of EU going public the website with details of the case is...
European Commission - Competition
No news as yet but i think it will be released here first.
European Commission - Competition
No news as yet but i think it will be released here first.
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DDee, agreed. It would be normal for all existing Directors to be required to resign as part of the completion process and for the Buyer to appoint their own Board, change bank mandates etc etc....
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Ddee737
IAG are buying 100% of bmi and includes all staff, the directors are employees of bmi and will have long lead termination clauses of between 6 12 months ( pilots have 3 months) so yes I am for real.
They will continue to be directors of bmi owned by IAG until such stage that bmi is dissolved or merged into BA or the are replaced/contracts terminated by IAG
Of course it's unlikely that they'll be kept on long term, perhaps even short term, but thats the way it works, they have employment rights just like another employee and IAG will deal with it carefully wrongful dismissal on their pay scale would not be something IAG will want to get involved with, they will in practical terms be let go with a large, very large golden goodbye.
They will continue to be directors of bmi owned by IAG until such stage that bmi is dissolved or merged into BA or the are replaced/contracts terminated by IAG
Of course it's unlikely that they'll be kept on long term, perhaps even short term, but thats the way it works, they have employment rights just like another employee and IAG will deal with it carefully wrongful dismissal on their pay scale would not be something IAG will want to get involved with, they will in practical terms be let go with a large, very large golden goodbye.
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but thats the way it works, they have employment rights just like another employee
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Flypuppy
Redundant or paid off either way they'll be gone doubt, but yes I would say they'll still be around for a little while to hand things over, at the moment they are still competitors and have to act solely in bmi interest.
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So 12 slots made available to new entrants on domestic/european routes not defined, with 2 slots leased to Transaero. But Transaero have been using those 2 slots for a number of years already under the agreement reached when BD started flying to Moscow so no actual change there. So IAG have really only given up 12 not 14.
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Eu press release
EUROPA - Press Releases - Mergers: Commission approves acquisition of British Midlands (bmi) by IAG subject to conditions
Mergers: Commission approves acquisition of British Midlands (bmi) by IAG subject to conditions
Brussels, 30 March 2012 - The European Commission has cleared under the EU Merger Regulation the proposed acquisition of the UK airline British Midlands Limited (bmi), by the International Consolidated Airlines Group (IAG), the holding company of British Airways and Iberia. The decision is conditional upon the release of 14 daily slot pairs at London Heathrow in order to facilitate new entry, and upon IAG's commitment to carry connecting passengers to feed the long-haul flights of competing airlines out of London Heathrow. In light of these commitments, the Commission concluded that the transaction would not raise competition concerns.
Commission Vice President in charge of competition policy Joaquín Almunia said: "The Commission could clear this transaction in the first phase given the commitments package offered by IAG which addresses the competition concerns we identified. The commitments package includes an appropriate number of very sought-after slots at London Heathrow as well as far-reaching feeder arrangements as regards connecting passengers. We are therefore satisfied that the competitive dynamics will be maintained so as to ensure choice and quality of air services for passengers."
The Commission’s investigation found that the transaction, as initially notified, would have led to high market shares and even monopolies on a number of domestic, European and international routes out of London Heathrow airport. The Commission also analysed whether there was a risk that IAG would prevent passengers from connecting on long-haul flights operated by competing airlines out of London Heathrow.
During the first-phase review, IAG submitted commitments to release 12 daily slot pairs at London Heathrow which could be used on the specific routes of concern, including the UK domestic routes, as well as on other European routes. In addition, two Heathrow daily slot pairs will be leased to Transaero for use on flights to Moscow. These slots and other incentives such as the acquisition of grandfathering rights after a certain period of time should facilitate new entry. Furthermore, IAG committed to entering into special agreements with competing airlines which operate long haul flights out of London Heathrow to provide these airlines with connecting passengers, including from UK domestic routes and other European routes. Passengers will therefore continue to have a choice to use other airlines than IAG when connecting at London Heathrow.
These commitments adequately address all competition concerns identified by the Commission. The Commission therefore concluded that the proposed transaction would not significantly impede effective competition in the European Economic Area (EEA) or a substantial part of it.
The transaction was notified to the Commission on 10 February 2012.
Companies and products
The undertaking International Consolidated Airlines Group ("IAG" - United Kingdom) is the holding company of both BA and Iberia Líneas Aéreas de España, S.A. bmi is currently owned by Deutsche Lufthansa AG.
Both IAG and bmi provide air transport for passengers, air transport for cargo, airport ground handling services and maintenance, repair and overhaul services.
Merger control rules and procedures
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.
The vast majority of mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
EUROPA - Press Releases - Mergers: Commission approves acquisition of British Midlands (bmi) by IAG subject to conditions
Mergers: Commission approves acquisition of British Midlands (bmi) by IAG subject to conditions
Brussels, 30 March 2012 - The European Commission has cleared under the EU Merger Regulation the proposed acquisition of the UK airline British Midlands Limited (bmi), by the International Consolidated Airlines Group (IAG), the holding company of British Airways and Iberia. The decision is conditional upon the release of 14 daily slot pairs at London Heathrow in order to facilitate new entry, and upon IAG's commitment to carry connecting passengers to feed the long-haul flights of competing airlines out of London Heathrow. In light of these commitments, the Commission concluded that the transaction would not raise competition concerns.
Commission Vice President in charge of competition policy Joaquín Almunia said: "The Commission could clear this transaction in the first phase given the commitments package offered by IAG which addresses the competition concerns we identified. The commitments package includes an appropriate number of very sought-after slots at London Heathrow as well as far-reaching feeder arrangements as regards connecting passengers. We are therefore satisfied that the competitive dynamics will be maintained so as to ensure choice and quality of air services for passengers."
The Commission’s investigation found that the transaction, as initially notified, would have led to high market shares and even monopolies on a number of domestic, European and international routes out of London Heathrow airport. The Commission also analysed whether there was a risk that IAG would prevent passengers from connecting on long-haul flights operated by competing airlines out of London Heathrow.
During the first-phase review, IAG submitted commitments to release 12 daily slot pairs at London Heathrow which could be used on the specific routes of concern, including the UK domestic routes, as well as on other European routes. In addition, two Heathrow daily slot pairs will be leased to Transaero for use on flights to Moscow. These slots and other incentives such as the acquisition of grandfathering rights after a certain period of time should facilitate new entry. Furthermore, IAG committed to entering into special agreements with competing airlines which operate long haul flights out of London Heathrow to provide these airlines with connecting passengers, including from UK domestic routes and other European routes. Passengers will therefore continue to have a choice to use other airlines than IAG when connecting at London Heathrow.
These commitments adequately address all competition concerns identified by the Commission. The Commission therefore concluded that the proposed transaction would not significantly impede effective competition in the European Economic Area (EEA) or a substantial part of it.
The transaction was notified to the Commission on 10 February 2012.
Companies and products
The undertaking International Consolidated Airlines Group ("IAG" - United Kingdom) is the holding company of both BA and Iberia Líneas Aéreas de España, S.A. bmi is currently owned by Deutsche Lufthansa AG.
Both IAG and bmi provide air transport for passengers, air transport for cargo, airport ground handling services and maintenance, repair and overhaul services.
Merger control rules and procedures
The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.
The vast majority of mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II).
