The OFT's decision not to make a request to the European Commission for a UK review of the proposed acquisition, is a very strong signal that they see no great problem with the deal, in the UK market.

If that is the case, then I can't see the EC delaying the deal any further. As I have said elsewhere, dragging on this purchase process any longer than is necessary is in no one's interest.

Actually they havent "waived it through" to the EC. The primary jurisdiction is with the EC in a case like this due to turnover in other jurisdictions than the UK. It is quite unusual for the OFT to run a parallel case when the EC has jurisdiction, and as they say, they will be providing input to the EC to assist the consideration of the case.
As to whether it will get delayed further, the EC doesnt give a damn about what the parties think about the need for speed...they will take as long as they think it needs to resolve any competition issues on specific routes, and willl drag it out if they think that is necessary. They were very close to dragging out the takeover of bmi by LH in 2009 over one route that had less than 20k pax a year. There are much more significant issues with this deal.

Big cheese, check your facts before exposing odeur de moisi...

Ribble, I reckon it's you who need to check your facts here I'm afraid.

Anyone want to comment on Lufthansa taking a EUR 285m charge as a result of bmi losses and disposal to IAG (and whoever ends up taking baby and regional) ?
Annual figures for Lufty group were worse than expected according to Reuters

Formal financial statements due on 15 March

Lufthansa - Lufthansa generates operating profit of EUR 820m in 2011. Executive Board proposes dividend of EUR 0.25.

I have no sympathy for Lufthansa for any of the losses which they have made as a result of bmi. Together with Sir Michael Bishop they have suceeded in getting rid of a proud part of british aviation and history. For this reason I hope bmi will finally be integrated into british airways and help strengthen our national airline.

Lets not forget that the Lufthansa Group will still be walking away with almost double the number of slots they had before they accquired bmi a few years ago, another reason why I have no sympathy for them at all!

They should quit playing the victim!

Just been having a quick look through the posts and I have to say it is full of lots of thoughts and ideas. The trouble is unless any of us are actively involved in the sale process, then all of this is complete speculation. Something that I think we can all get lost in.

The only fact is whatever the outcome, we will know when the time is right. Irritating I know but I'm guessing I'm not alone in saying I too need to be reminded of this every once in a while?

On the flip side, and I must stress this has no substance, I'm hearing increasingly that integration into BA is becoming increasingly more likely. And pushed into Gatwick? Has anyone got anything that might back this?

MP

Here here bmybaby81!! Spot on. I had Wolfgang on a flight and he happily discussed all that's been going on with me, quite candidly (which suprised me slightly). Having been to one of his initial business briefings when he took over I asked what had become of his vision of bmi as
"simply needing to replace small aircraft flying to low yield shorthaul destinations from one of the world's most expensive airports, to an airline with larger aircraft flying longer and more lucrtive routes to make the most of it's slot portfolio". His answer was pretty easy to de-code and simple, Lufthansa got COLD FEET. He is not somebody who came to do a mopping up operation, he had big plans to expand bmi, just as he did at Jet in India, but when he went to Lufthansa to find some a/c they just got cold feet. Direct quote: "It was a case of the aircraft just not...being made available to us", there were...certain reassurances that we just couldn't provide to our shareholder".

Ayebmi,
Please be very careful in quoting any individuals on an open forum, if you're an employee you may be in breech of your contract. Not a good time for a disciplinary.
The Dr.:=

He's not said anything that isn't widely known throughout bmi nor the rest of the industry really.

I stand corrected on the EC giving the deal an easy ride...

This is saying that substantive issues seem to have been raised so IAG will have to put forward remedies (e.g. divestments of slots) to get clearance from the EC before end March. Otherwise it would risk a phase two investigation which would go beyond that date and they couldn't complete while it was still going on.

But surely all this is saying is that the deal as it stands (i.e. a takeover, lock stock and barrel, of bmi) will have an impact on competition (obviously), so there will have to be remedies. The need for remedies shouldn't come as a surprise to anyone - it's been fairly evident from the start, and indeed it has generated much of the content of preceding pages on this thread! ;)

It's difficult to see to whom any slots could be handed/sold to address any competion concerns, perhaps this is the reason behind the delay on completing the bmir deal?

Who would or could want to run services into LHR from say EDI ABZ MAN up against all that BA can offer in terms of FF points, business lounges, and onward connections?

A few crumbs to Virgin? Perhaps using bmir to feed? under a new name? Doesn't add up to me and if the price for clearance is to high then IAG might walk, what then for bmi?

I think more likely is some reassurance for the Scotts on flight frequency and prices, but given the upward march of oil it would be meaningless

Without access to LHR slots there is no way to address any of this, there is ample connections to other London airports from Scotland and NI

a number of carriers have started, or are about to start, operations to Gatwick that already operate to Heathrow, they have made it clear they would prefer a one airport operation in London. BMi will have no difficulty shifting these slots

It doesn't and I am sure someone, somewhere had already factored this into the equation.

STN Ramp rat
 

I think you missed the point re competion post BA/bmi

Simply giving slots to another operator to fly from LHR will not address the competion concerns unless these are used on routes where BA/bmi currently compete , which are Scotland & NI plus. Manchester. No one is going to do that in my view!

I think BA will get away with promising to keep a LHR service from BHD as well as BFS & additional frequency on EDI to keep the SNP happy

With regards to WPS I think he will be bitterly disappointed about the way things have worked out for bmi but it was always going to be an uphill struggle to turn around the mess left by NT & SMB and the economic melt down followed by the Arab spring was to much even for the mighty Lufthansa to overcome.

Leaving bmi as a "stand alone" company within the IAG group rather than integration with BA might well be a workable remedy.

It lost millions as a 'stand alone' company. It still lost millions when it was slightly integrated with DLH.

If IAG is forced to give up slots I'm not sure how this will work. Will the bidding airline have to pay IAG for the slots or do they get them for free?

Typically how it works is this. The purpose of the slot release is to ensure competition on a given route. Therefore the slots are only usable for that route (let's say LHR-EDI). The bidding airline gets the slots for free, on condition that they are used on the route in question. You can't take the slots and then turn around after a week and say "oh, we want to use them for LHR-JFK instead". The regulator may appoint a "monitoring trustee" (law firm or similar) to ensure the slots are used appropriately.

For a good example, see the EC's judgement on the Lufthansa takeover of Brussels Airlines (PDF). It's a long document (but an example of the level of detail that typically goes into the analysis) but most relevant for your question are pages 118 onward, the commitments (= the proposed remedies). You'll see (section 439, page 120) that a new entrant gets to keep the slots ("grandathering rights") after a certain number of seasons, i.e. after that period, the slots can be used for alternative routes if the original plan isn't working out.

Note also (and this is relevant for IAG/bmi too) page 120 onwards also describes the other commitments, e.g. interlining/SPA provisions for connecting passengers.

I think this is a reasonable template of what we could expect as conditions for approval of the IAG/bmi deal.

(I should add as a postscript, though, that this document also shows the limits of the regulator's approach. They approved the LH/SN deal on the basis that they were confident that another carrier would enter the relevant competed routes (BRU-FRA, BRU-HAM, BRU-MUC in particular). You can read the document and see that they fully expected VLM and/or Croatia Airlines (!) to do so. Actual result (unless I missed something!): no market entry, no competition. The alternative is to get an upfront commitment from a new entrant before approving the deal, and that's fraught with its own problems (see OFT Air France/CityJet/VLM as an example).)

Hope this helps
C.