As an amateur, it seems to me that unless an airline behaves in an extraordinarily foolish manner, we have reached the position where incumbents pretty much own the slots provided they use them.

Are these slot values implicitly or explicitly on balance sheet?

The more interesting thing is who is now going to buy them and what they are going to do with them? I hear it could be IAG, now what would they want with 20 slot pairs at LGW?

Maybe will try to level the low cost long haul playing field? ;)

Well, if you've heard what Ive heard, they have paid (or have agreed to pay) between £50-60m for them.

Well if it’s IAG I suspect we will see additional 772s displaced from LHR as additional A388s arrive ex 2nd hand.

I also suspect that the trial of 2nd hand airbus short haul aircraft for the lgw base has proven successful in IAGs eyes and that we will see some A321/320s appear off the 2nd hand market.

Just a suspicion not backed by any fact at all.

WW is reported as saying that Level and Iberia Express would have been treated as new entrants if the slots had been returned to the pool.

Reported that TCX are interested in LGW slots
https://www.reuters.com/article/mona...-idUSL8N1NU272

Monarch owners could profit from collapsed airline

Administrator warns secured creditors unlikely to be repaid in full


Monarch entered administration after it failed to find a buyer earlier this month © AFP

Monarch Airlines’ former owners could yet make a profit on their investment despite administrator warnings that secured creditors are unlikely to be repaid in full.

In its first creditors report since Monarch’s collapse, KPMG said the airline’s secured creditors would probably “suffer a shortfall” even once two of Monarch’s main assets — its take-off and landing slots and the airline’s engineering business — were sold.

Though it remains unclear how much money will be recovered for Monarch’s secured creditors, Greybull Capital, which has first call on the airline’s assets, could still walk away with money.

The creditors report does not detail how much money is likely to be recovered for Monarch’s secured creditors, which after Greybull includes PPF, Monarch’s pension scheme. In total, Monarch has a secured debt of about £167m, with Greybull owed about £160m and PPF £7.5m.

However, a large proportion of Greybull’s exposure was either debt assigned from Monarch’s previous owners, the Swiss Mantegazza family, or cash contributed by them. The actual cash put up by Greybull was no more than about £85m, according to a previous FT analysis.

The initial report, published on Friday evening, comes just days after KPMG won an appeal against a previous High Court ruling stripping Monarch of the rights to sell its valuable airport slots at London Gatwick and Luton. The decision was seen as a big boost for Monarch’s administrators, as selling the slots to rival airlines will help recover money for creditors.

But KPMG did not provide an estimation of how much money these slots could raise, or ascribe a value to the airline’s engineering business.

The report also noted that Monarch has about £30m in cash, and estimated the administrator’s costs to be about £10m.

At least one deal for the slots is expected to be announced early next week. EasyJet, IAG, Wizz Air and Norwegian Air Shuttle have previously signalled their interest in buying Monarch’s slots. The slots at Gatwick have generated the most interest because of a lack of airport capacity during peak times.

Greybull previously said it would expect Monarch’s pension scheme — which is owed £7.5m — to be repaid if the private equity group made any profit.

KPMG’s report said, “No distributions have been made to the secured creditors to date. Overall we consider there is likely to be a shortfall to the Company’s secured creditors.”

It added, “Whilst the slots and the engineering business have yet to be realised, in our view value is likely to break in the secured debt.”

However, KPMG said it expects preferential creditors, Monarch’s employees, to receive 100 per cent of the money owed to them.

The rest of the airline’s creditors are likely to get nothing, or just pennies in the pound.

In October, Monarch became the third carrier in Europe to enter administration this year after it failed to find a buyer for some of its assets. The collapse led the UK government to launch Britain’s biggest peacetime repatriation, flying home over 85,000 holidaymakers stranded overseas, costing taxpayers £60m.

Over the past two months, Greybull has come under pressure to foot some of the government’s repatriation bill following speculation they may end up making a profit. Last month, following public criticism from the transport secretary, the private equity group acknowledged it had a “moral obligation” to help meet the government’s costs.

The authors of the article obviously didn’t read the line about employees compensation being capped at £800.

Finally got around to reading the judgement myself and that was my first question... Since ACL have said they won't facilitate the transaction with dummy slots then it's a case of KPMG ending up with some 'real slots'. What on earth will happen to those? Of course they can be confiscated under the 80% rule, but then we're deeper in to the hole of what is and isn't an air carrier.

Being reported IAG have secured the majority of MON slots at LGW significantly outbidding any other interested parties.

Southside - I was told the other day that IAG had secured all of them, costing approx. £60m.

You've got to wonder at IAG or at least the BA part. They repeatedly increase their LGW slot holding (eg buying Dan Air and CityFlyer) and then let their slot pool dwindle away and then pay through the nose for more slots again.

toledoashley-Appears you are correct tho no price indicated yet & report states "majority".

Not forgetting British Caledonian, British Airtours and gawd knows who else

Southside - My source says that they were keen to sell as one, so we will see on that...
Willy Wombat - You could say the same about Go, and the endless cost cutting.

The PA, as reported by the BBC, is now confirming that IAG has bought most of them, significantly outbidding others.

The BA brand at Gatwick is strong particularly the Holidays division. I expect BA will use a lot of the slots. BA have a few airbus deliveries next year. Easy enough to keep older ones longer than expected. Don't forget there are also 30 or so ex monarch aircraft seeking new homes. Perhaps a couple more 777s based at LGW too. Level have two aircraft at the moment with another 3 due but also proposed new bases in mainland Europe. I also believe BA long haul from Gatwick makes good money already. Other airlines in the group may use some of them. However for the time being I think BA at Gatwick will use most of them.

Some of the Monarch aircraft already have new homes. One has gone to a carrier called Lanmei airlines.

I think that change is the nature of business. Things get bought in good times, sold in a downturn, contracted in a downturn, expanded to stifle competition etc.etc.

BA will naturally wish to avoid as much as possible, further expansion by Norwegian, so that certainly would be a factor in securing these slots...