BMI

[LD12986]

Well according to "sources" IAG is the front runner to buy bmi mainline.

IAG seen as frontrunner as bmi deal nears-sources (http://mobile.reuters.com/article/idUSL5E7M133O20111101?irpc=932)

To those that balk at the thought of BA buying bmi, who else is going to buy it bearing in mind it's clear that LH want to sell and no-one else has the combination of big enough pockets and an existing operation in which to absorb bmi?

[Say again s l o w l y]

There are numerous reasons for not selling bmi to IAG from Star and DLH's point of view. From surrending LHR (which they do care about) to the fact that the price for the company won't really be that attractive at all.

Selling bmi's fleet isn't really a goer since the aircraft in the vast majority are leased not owned. So asset stripping in this case isn't really worth it.

Since this is dragging on and on, then I am pretty certain that there is an almighty ding dong going on in the Lufty group board room. If bmi is sold off or shut down, then the egg on the face for the people involved in the original deal will be huge, in the past 12 month LH Italia failed and now if they get shot of bmi, they've failed there too. Ego and reputation are important when it comes to things like this.

I'm not saying that IAG won't buy bmi, just that I think there are other options that seem more likely when you think about it in more depth.

[CabinCrewe]

What are these other options apart from IAG that seem more likely to you?

[stormin norman]

Buying or merging with mainline BMI dosn't stack up for BA.

All the pressure is on LH to sell, not for anyone to buy.

[Flypuppy]

BA would not be the purchaser. IAG would buy the slots, they wouldn't want the airline.

[Airbus321-200]

I believe the monarch announcment will be before the end of the week.

But merging 2 loss making airlines together doesn't make sense.

[Mister Geezer]

He said at the end of the very long day that Monarch have a HUGE announcement to make in a few weeks time...

Ah.... so the cabin crew are getting a new uniform then? ;)

[king surf]

Flypuppy If BA for eg were to only buy the slots how would they fly them without the aircraft?
There is no way that BA have enough Aircraft to fly 50 extra flights per day.
If a company buys a slot pair they have to fly them the next day!!.They do not have the Luxury in waiting for 27 aircraft to come off the production line.

[pointless username]

All this talk about IAG maybe buying bmi and not BA, and that this somehow makes a subtle difference as to whether they can avoid a TUPE purchase/just buy the slots etc is rather spurious if you ask me.

Of course it would be IAG rather than BA, as they are the mother company that hold the purse strings- just like when BA recently purchased the 6 slots from bmi the press release stated that "BA have obtained approval from IAG to purchase....", or to give another example when bmi have needed (lots) of money for anything in the last few years, it was DLH we turned to.

And no doubt you'll see some posters say "told you so, it was IAG" should this come to pass, but it is largely academic which of BA/IAG do the actual buying, as it would be BA, and not IAG that would then do the operating of the assets- let's hope with some well trained bmi crews.

This is a worrying time for bmi employees, and having pontification and schadenfreude doesn't help anyone except the know-it -all armchair generals.

[Hipennine]

Why wouldn't BA (not IAG) want the slots plus aircraft and crews? The one factor that people are missing at the moment, and why the potential purchase of slots and aircraft to fly them by BA is timely right now, is the Olympics. There has already been discussion elsewhere on Pprune re any potential for BA to operate additional flights in 2012 (not possible). BA is still perceived in many markets as the flag carrier, and has a clear association with the 2012 events. It is therfore uniquely placed to capitalise on the potential additional high yield volumes if it has the slots and the aircraft and crews to fly them. The extra profit generated could go a long way to covering the purchase cost.

[LD12986]

But for the trillionth time, and the link you've posted alludes to the same thing, if, and it is a massive if, bmi is sold to them it would be IAG buying it, NOT BA. There is a massive difference. BA is now a brand of the IAG group....why is that so hard to understand? I would also bet everything i own that there would be no merger, and there will be no bmi pilots/crew flying BA aircraft having being merged into the seniority list.

IAG is one of the few airline groups out there at the minute who's is doing reasonably well. Why on earth would they jeapordise that and take on something losing hundreds of millions of pounds a year, and commit themselves to flying a shedload of extra flights just to keep the slots, all at a time when that is probably the LAST thing anyone would want to do.

IAG want some (note some) of the slots, clearly. The rest of it, no, i dont think so.


I am well aware that IAG owns BA and M&A decision making now sits in IAG.

If IAG chooses to buy BD, whether it sits immediately under IAG or under the BA operating company is IAG's call and will be driven by a whole host of factors, such as tax structuring, financing and management reporting lines of the IAG structure. Ditto for whether it remains as a separate operating company or formally merges with the BA operating company.

Either way, it seems clear that LH want to dispose of BD by year end and it is the airline IAG is bidding for. The issue of BD's liabilities/losses are all things that will be factored into the deal price and terms.

There will be hard work ahead for IAG/BA if it buys BD but they're not going to pass at a once in a lifetime chance to grow significantly at LHR. And IAG has a CEO who is not one to shy away from hard work and difficult decisions.

IAG's Q3 results are out on Friday and they may give an update to the City on what they're doing then.

[whoshotjimmi]

BA need the slots at LHR to continue to compete with the other large European carriers and Emirates, all of whom have much more room for expansion at their own hubs. I would be very surprised if BA did not acquire the majority of the slots. No doubt, some of those slots would have to be shared out to others for the purposes of competition regulations but I am sure BA would be happy enough with that.

If slots must be used straight away, then a total takeover of BMI seems logical as the aircraft and crew are there to continue flying whilst BA sets about a restructure of its routes and timings.

There is, of course the possibility of benefits being seen across the UK. Operations into the likes of MAN and EDI could be streamlined, potentially with larger aircraft releasing further slots at Heathrow that could possibly see the introduction/reintroduction of connections to other UK POD's. Thus, British Airways could start to truly think of itself as being British again.

With regards to Star Alliance, though they would lose a chunk of Heathrow, it would not mean that they no longer have a route in and out - plenty still serve it - it would more likely have an effect on transit with the emphasis more on Star strongholds such as Frankfurt, Brussels and Zurich.

[stormin norman]

LD, your correct in BA would not to miss out on expansion at LHR but more worrying is the risk to BA's cash position with a possible economic slowdown on its way.

[INKJET]

Whilst i would not rule out further slot sales by bmi (to the highest bidder) in 2012 i think a take over of bmi by the IAG group remains very unlikely, the suggestion that DLH would sell all bmi LHR slots to fund a closure of bmi including its pension deficit is a non starter. Any deal involving the sale of bmi slot portfolio will require the buyer to buy bmi as a going concern, winding bmi up is not on the table.

In simple terms the PR damage done to the DLH brand by putting 3811 employees on the dole and seen to be pocketing 200 -500 million from the slot sale is far worse than the current financial pain DLH are enduring. With regional & baby away and a re focus on its route structure all ready underway it is likely that losses will start to fall in 2012.

DLH and its star alliance partners are not about to walk away from LHR.

[LD12986]

DLH and its star alliance partners are not about to walk away from LHR.


What Star Partners think is irrelevant. They're not the ones with bmi bleeding red ink over its balance sheet.

DLH have said their thinking towards LHR had changed. Even if they ploughed in millions to turn around bmi it will still be No 2 behind BA by a considerable margin and bmi is unlikely to cover its cost of capital. DLH are interested in hubs where they are Number 1 (FRA, MUC, ZRH etc).

[look you]

If Star Partners were interested they could help to offset the losses!

Not to sell bmi after all the noises about it from Frankfurt would be absurd. Gemkow has won the boardroom fight, they want rid of bmi, IAG are the favourites. If they can sort out the price, then the deal will be done. Frankly neither side can afford not to do this deal.

Having bought it, running it as bmi would be mad. They'll want to use its presence to drive down BA short haul costs. That will lead to a fight with the BA and bmi unions, so they'll have to incorporate it into BA and do a "deal" with the employees, a lot of whom will get made redundant.

[TCX69]

Looks like the whole bmibaby/Monarch rumour is true then!

[davidjohnson6]

It ain't true until the fat lady sings / the contract is signed / Lufthansa publicly announces it (delete as appropriate)

[Flypuppy]

King Surf, IAG is more than just BA. Iberia airframes could be used to fill some of the gaps and there are plenty of airframes that can be ACMI-ed in.

Inkjet, didn't you say that it was "utter tosh" that bmi Regional would be sold?

[CAT3C AUTOLAND]

Seems like a number of people could be eating their own words from this thread once Lufthansa announces what is going to be done with main line ;).

[OliWW]

Anyone actually got 1 reason why Monarch actually want bmibaby? Can't understand it myself... :ugh:

[Flypuppy]

14 Aircraft's worth of Boeing experienced crews?

Jet2 would be a better fit though....

[LD12986]

The Financial Times also reports that IAG is a frontrunner to buy bmi mainline. Unless there is a big deal breaker, it looks like it's going to happen.

IAG in ‘detailed talks’ to buy BMI - FT.com (http://www.ft.com/cms/s/0/195302ea-0573-11e1-a429-00144feabdc0.html)

International Airlines Group has emerged as frontrunner to buy BMI British Midland, Lufthansa’s loss-making UK subsidiary.

IAG - parent of British Airways and Iberia - has entered “detailed talks” with Lufthansa and could conclude an outline deal to purchase BMI this month, which may then need regulatory approval, said people familiar with the situation.

[max nightstop]

Baby would provide instant bases for Monarch, that's the best reason...

Just because the FT rehashes what Reuters said, doesn't make it any more likely! These journalists are utterly idle!

[LD12986]

The Financial Times is a credible operation and they tend not to just rehash stories like other papers.

[max nightstop]

Maybe so, but the FT report brings nothing new to the story that Reuters didn't already mention, so excuse me for being suspicious.

"People familiar with the situation"? Well that could be me!

[INKJET]

Pup

My " utter tosh" comment was in response to Ric's suggestion below


My source is pretty reliable. I am told that Eastern have submitted a bid and it is being considered by Lufthansa. Story is that Lufthansa are looking for quick injections of cash to offset the massive losses of the bmi group. I dont think they will be able to keep the regional name or branding. Eastern already have EMB-145s don't they?




DLH do not need a quick injection of cash, in fact the cash will probably flow the other way!, its not being sold to Eastern and the new Regional owners will keep the bmi Regional brand for at least 12 months, so yes it seems to me that it was utter tosh.

The only quick injection to date is the sale of slots, DLH have seen a slow down in Europe and will move to protect their balance sheet in various ways this winter.

[The SSK]

(aside)
Reuters - and Bloomberg, Associated Press, Agence France Presse etc - is in business to uncover news stories and sell them on to the press and other media. Of course the FT use their material.

[Flypuppy]

Inkjet,

I am very familiar with the Regional situation and the comment that
in fact the cash will probably flow the other way!
is absolutely untrue.

Branding may well be retained for up to 12 months but that does not in any way imply any form of financial input or subsidy from either bmi Group or Lufthansa.

[max nightstop]

Apart from the leasing costs of flying bmi routes from LHR on the Emb145. This will, presumably, involve cash from someone to the new owners...

[INKJET]

Pup

If you say so.

So who's buying baby then?

[Flypuppy]

Not quite sure what you mean max, but the acmi arrangement is a standard contracted service offered by a provider (in this case, Regional) to bmi.

Inkjet, I would have thought you would know better than me :ok:

Rumours I have heard involve two UK based 737 operators in discussion with Lufty M&A.

[max nightstop]

The chances of a lease arrangement between Regional and bmi being anything close to "standard" are pretty slim!

[easyflyer83]

Rumours I have heard involve two UK based 737 operators in discussion with Lufty M&A

Why be so cryptic?

[Skipness One Echo]

If you seperate out bmi from bmi Regional how much of the below makes any sense?

ABZ-MAN - flybe target
ABZ-NWI - monopoly / niche
ABZ-GRQ - monopoly / niche
ABZ-EBJ - monopoly / niche

EMA-BRU - possible Brussels Airlines target

EDI-BRU - Brussels Airlines target
EDI-MAN - flybe target
EDI-LBA - monopoly
EDI-CPH - SAS target
EDI-ZRH - Swiss target

GLA-LBA - monopoly
GLA-CPH - SAS target

LBA-BRU - possible Brussels Airlines target


BRS-BRU - currently op for SN
NCL-BRU - currently op for SN

Take away all the LHR flying and the routes above that former STAR partners will be looking closely at, it's all very niche. The MAN routes would be wide open to predatory action by flybe especially once the bmi brand is removed. Glasgow is already vulnerable as it's a single aircraft that does three rotations per weekday and spends much more time parked than flying.
Edinburgh has potential, but more so for inbound traffic by SAS on the CR9 and Swiss on the RJ100 allowing both point to point AND connectivity, Aberdeen is nicely niche however.

The question I would be asking is just how much will remain after a sale? There are no synergies or economies of scale that I can see here, quite the contrary, and former partners will quite likely be tomorrow's competitors. Four routes to Brussels, two of which are operated on behalf of a (former) partner.

[Rougueg]

I would imagine that the first thing the new owners of Regional will do is change the name so as to distance themselves from any future BMI troubles.

Although the letter to BMI staff says that regional will keep the winter and summer 2012 schedules. I think that has been said to make the sale of other aspects of the group look more favourable.

I would suggest that some significant adjustments of the routes should be expected, before Summer 2012. Especially bearing in mind what Skipness One Echo said above.

Regional definitly has the Aberdeen market cornered but that is hardly enough to maintain a decent load on a fleet of 18 aircraft full time.

Will be interesting to see what occurs.

[Facelookbovvered]

I would have thought that a code share or Star partner for bmi regional MK 2 would suit all involved I can't see much change here other than it's off LH books

[LD12986]

A memorandum of understanding between IAG and Lufthansa has been signed according to Bloomberg:

Lufthansa May Have Deal to Sell BMI to BA - Bloomberg (http://www.bloomberg.com/news/2011-11-03/lufthansa-said-to-reach-deal-to-sell-bmi-unit-in-u-k-to-british-airways.html)

[Flypuppy]

Why be so cryptic?
Sometimes you have no choice...

There are not that many UK based 737 operators that would fit with bmiBaby though...

[toledoashley]

A British operator could mean many different things...

Jet2 - Do they need to expand via a ready made low cost airline?
flyBE - Do they have the money?
Thomson - Why do would they need a low cost airline?
Monarch - Seem to have a cautious approach...
British Airways buying both baby and mainline? Doesn't look logical, but you never know...
Virgin - maybe looking at relaunching European holidays?? - Virgin Sun?

Stelios?
Management buy-out/venture cap?

[JSCL]

Ahem.

Possible Transavia UK launch. The fleet would fit.

[Flypuppy]

toledoashley,

FlyBE are not 737 operators, nor are Virgin. BA would not fit with Baby nor would Thomson. Stelios is an unlikely suitor as are Astraeus. Transavia are not a UK based 737 operator.

[davidjohnson6]

I thought Transavia UK was sold to Ryanair several years ago - it was called buzz

[CabinCrewe]

No, buzz originally was a low cost spin off of Air UK whose group was ultimately taken over by KLM and Buzz disposed of to FR

[sealink]

Bloomberg news reporting IAG to close deal to buy bmi and this will be announced tomorrow when they ( IAG ) announce their profits.

[easyflyer83]

Air UK were KLM UK well before Buzz was conceived. The 146's of Buzz were repainted out of KLM livery.

[JSCL]

But Transavia is expanding and it's always been talked about as potentially expanding to the UK when the time is ready - if they're selling Mainline to OneWorld, where's the issue selling Baby to SkyTeam? It'd be a good access point to the UK market for AF/KL before IAG bring Vueling over here...

[Cyber Bob]

IAG have bought BMI - to be formally announced tomorrow

[JSCL]

I HIGHLY doubt IAG have *bought* BMI to be announced tomorrow, but I await to be proven wrong and would welcome the news.

IAG *might* announce that it has bought BMI's LHR slots - now that I can believe. But buying BMI Mainline? It's a headache not worth having for IAG - where's the benefit yet again? Unless the fleet would be handy for some of the aging fleet especially at LGW and even some LHR frames I suppose - then maybe that could work. But I await the news.

[Cyber Bob]

That's what's being announced. No-one knows the full detail yet but it seems to be a full buy out and not a cherry picking slot grab apparently.

Announcement tomorrow

[brian_dromey]

If IAG want the slots, they will have to take most, if not all, of the fleet, otherwise they will loose the slots, they will need a lot of BD's current people too, to fly these aircraft. The route network will be pared an optimised over time, probably domestic and other competing destinations first.
The A32X's are fairly compatible with the rest of the BA fleet, so it's not a huge deal, Im sure Ba can find a use for most of the BD fleet. I suspect the A330s will be disposed of pretty quickly, if they are acquired at all, those routes would simply be operated by 767 or 777, I should imagine.

[Say again s l o w l y]

An MOU has been signed. That does not indicate that the deal has been done, but it's a step along the road to a sale.

Nothing is guaranteed until the money is in the bank.

However, I am again unsurprised and pretty disgusted that we at bmi have found this out via the media, rather than by being kept even remotely informed and treated like adults. But hey, it's one of the main reasons that bmi is in this situation in the first place, so why change the management habit of a lifetime...

When we found this out today. The final sense of caring that most people have been desperately trying to hold onto whilst this debacle has gone on, evaporated in an instant.
I've never seen such a fed up bunch of people, who just a few weeks ago were passionate about their company and proud to wear the uniform despite what had been going on.

Well done. Achieving that sort of turnaround in staff morale is really quite an impressive feat... :D

Good luck everyone at the coal face. I've been proud to work with you all at bmi and I can comfortably say that it isn't the staff who let the company down. However, they're the ones who'll be having another happy christmas with if not actual P45's in their hands, then threat of them will be looming as I can't imagine IAG/BA will want to take the company on as a whole.

I shall refrain from posting my real opinion of how things have been handled by our lords and masters as it would break the rules of this site in regards to swearing.

Time to do my best Yosser Hughes impression.

Gizza a job. I can do that...

[Say again s l o w l y]

That is my understanding too. However, with the lack of communication, all sorts of scenarios are being played out in people's heads about this.

IAG have stated that they are only interested in the slots, but what that actually means in reality, no-one has bothered to say.

So cue a whole horde of fed up people who are assuming the worst and wondering if the company will exist tomorrow, let alone in 6 months.

[CaptainSensible]

Bankrupt an airline (Bish & Co) and be elevated to the Peerage!!!!!. Funny old world we live in

[EI-BUD]

So who's buying baby then?


Inkjet, you seem to be in the know but here it seems you are unsure about WW so I would suggest you have all the facts or none at all. There is no way that if you are close to the facts that you wouldn't know about WW.

In addition, you stated some weeks back that WW are in the City Airport in Belfast for the long run.. or something that that effect, which indicates that you do know... so some contradictions.

It is highly unlikely that anybody knows what will actually happen should WW be sold. For bmi it a bit different in that the slots will be used at LHR by someone .. the buyer. But WW could change radically and lets face it, it only has approx 12 aircraft.

Also re bmi mainline, If there are so many interested parties including Emirates etc for slots, surely LH would be selling to the highest bidder so is it impossible that say BA will take half of the routes and staff and aircraft and other carriers will take the rest?

If BA dont take aircraft, then LGW will see the cut backs and airbus and long haul aircraft come to LHR. Besides didnt BA recruit a big batch of pilots recently? I wouldnt be surprised if BA stated that 'LGW is not a strong fit to our core model and better suited to LOCO carriers'.
Lets not forget BA will be setting their sights on TAP.. so a focus on core competences, like hub and spoke, differentiated from LOCO's, i.e. not LGW?

[AirLCY]

If it is IAG/BA then it might not be all bad, BA will need the aircraft to operate on the slots immediately after the sale completes or they'll lose the slots. They will therefore need the crews, and due to expansion they'll need some head office staff. I saw some BA jobs were on the external website, so there has to be opportunities for people.

Whatever the outcome, good luck to all of you at bmi, I hope it all works out ok for you.

[barroon]

All I can say is shame on Lufthansa, Wolfgang and the rest of the bunch. Spend your dole time getting LH out of the UK market, thats what I say for sending what once was the UK's second carrier to it's knees (with the help of Bish,Tuner and the like) is unforgivable. But remember living might seem like an ages, rotting in Hell is forever (Bish):\

[Max Angle]

for sending what once was the UK's second carrier to it's knees It was on its knees when they took over, they have failed to make it stand again, it was a half hearted and incompetent effort at a recovery.

[11K-AVML]

It was on its knees when they took over,LH have had people in the company for a long long time though. It's not like the situation so have shocked them when they took over.

[CAT3C AUTOLAND]

Say again S l o w l y, I can empathise with what you have written, and can only feel a little disappointed that we are presented with this information through the press again, assuming its true of course, which looks pretty certain.

All I can say is, it will be a sad day where there are no Bmi fins at LHR, the company has a lot of history. I have really enjoyed working there and have my fingers crossed for the next few months for all the employees of the company.

[Say again s l o w l y]

That's why they had to be forced to actually take it over in the first place. They didn't want it once they saw what was going on, however the actions of the people charged with turning it around have been somewhat mystifying.

The phrase "rearranging deckchairs on the Titanic" could have been designed solely for bmi in the last couple of years.

Cat 3, it will be a very sad day if/when (obviously when...) bmi ceases to exist as an individual airline. Even before I joined I had a massive soft spot for bmi and I've loved trying my best to help in any way I can to try and return the company to something near it's best. Unfortunately that effort has seemingly been completely in vain.
I cannot describe how galling that feels. Multiply that company wide and it's amazing that anyone will actually bother to turn up tomorrow. Of course we will, but by god it's tempting.

[barroon]

It was on its knees when they took over, they have failed to make it stand again, it was a half hearted and incompetent effort at a recovery.

Couldn't agree more and all involved will be 'hopefully' ashamed of themselves for years to come.
In reality they'll be off to some other project to make some more dosh while making a few thousand more redundant. As I said ' living might seem like ages, rotting i hell is forever.

[Flypuppy]

Just out of idle curiosity, how many long and medium haul a/c do BA have based at LGW?

How quickly could BA relocate their long haul ops from LGW to LHR? Would those fabled bmi slots be enough to cover a complete retreat from Gatwick?
Just a thought....

[Skipness One Echo]

They have 8-9 B777-200ERs per day on long haul with a winter based fleet of 19 B737-400s, joined by 2-3 A319s over the summer.

It's more than enough to consolidate all long haul at Heathrow however they have a rather good operation at Gatwick that works rather well on a (mainly) point to point business model, LHR opportunities *may* be better suited to contine adding frequency to business destinations funneling connecting traffic onto long haul.

Depends on what the synergies of taking the B777s out of Gatwick would be.

[Flypuppy]

Given those numbers then I guess it could be possible.

With economies of scale in a single location, it is not beyond the bounds of imagination that BA concentrate all their firepower in one location, they have also just gained some additional mx hangar capacity as well (assuming the stories are true - of course).

Stockley Close and the old BMed building would be available should there be any additional office space required.

It will be a very sad day when the last bmi tail fin flies into history :sad:

[FR-]

RNS Number : 5082R
International Cons Airlines Group
04 November 2011

IAG AND LUFTHANSA REACH AGREEMENT IN PRINCIPLE ON THE SALE OF BRITISH MIDLAND LTD


International Airlines Group (IAG) and Deutsche Lufthansa AG (Lufthansa) have today reached an agreement in principle for the sale of British Midland Ltd (BMI) to IAG.

The sale and closing of the deal remain subject to conditions including a binding purchase agreement, further due diligence and regulatory clearances. It is envisaged that the purchase agreement will be signed in the coming weeks and the aim is for the transaction to be completed in the first quarter of 2012.

[KeyPilot]

Just heard on BBC Radio4 Today programme (incl. interview with Willie Walsh).

BMI acquired by IAG.

Will have to see what competition authorities think of it, but it seems to be the final chapter entered for formerly independent British airline. Sad day. RIP.

[beerdrinker]

Just been on Sky. Lufthansa agree to sell BMI to IAG (BA + Iberia). Despite the fact that Lufthansa has been talking to Virgin (who presumably could not come up with an accetable offer) standby for Beardy to start whingeing.

BD

[crewmeal]

So now the speculation starts as to what will happen next................

Good luck to all the employees for the future.

[Capetonian]

If it is true, it's a shame. I flew on them just last week ago, and several times in the last year, always thought how good they are.

Can't find anything on the BBC website but I did find this in the Torygraph :

British Airways owner IAG close to £300m Bmi deal - Telegraph (http://www.telegraph.co.uk/finance/newsbysector/transport/8868688/British-Airways-owner-IAG-close-to-300m-Bmi-deal.html)

The deal would likely signal the end of the Bmi brand as IAG – the company formed from the merger of BA and Iberia – is only interested in Bmi's Heathrow slots. Bmi owns 8.5pc of the slots at Europe's busiest airport.

and this !
Ryanair chief: 'Pay for a Greece flight in goats'
More publicity for M O'Tormouth!

[AltFlaps]

Is bmibaby in the scope of this agreement?

[random_bandit]

I doubt BA would have included Baby in the deal, if anything, it would just serve as something they would have to spend money to on get rid of.

[CAT3C AUTOLAND]

Yep just had the word from the CEO. Looks like an exercise to tie up loose ends. I have loved working for Bmi, and will miss the company, but not the crew meals, bloody tight trousers :ugh:,

Fingers crossed for the future of all the employees.

[Wanabee,Gunnabee,Am]

Any mention of Regional or baby?

[Tay Cough]

AFAIK, Baby and Regional aren't included.

[Flypuppy]

Regional and Baby do not make up a part of the IAG deal.

[Tosh McCaber]

Hmm-

So what happens to them?

[Mister Geezer]

It was announced last week that Regional is being sold to a private consortium. Key individuals in the consortium are believed to be previously associated to Business Air.

[SpringHeeledJack]

A shame, but at least now they'll have one corporate identity for more than a few years. I too found their service and product to be good over the years and wonder how difficult it will be to merge the two corporate cultures together, something often overlooked in the rush.

[Facelookbovvered]

My reading is that IAG have bought bmi and at this point in time that includes both regional and bmibaby, regional is of course sold subject to contract and baby is probably not far behind.

God bless all who sail in her

[Flypuppy]

BBC report (http://www.bbc.co.uk/news/business-15588645)

Facelookbovvered, I can with confidence say that your reading is wrong. Regional is now and has been from the beginning a separate deal.

[Mister Geezer]

Thoughts are with all bmi mainline staff during which will undoubtedly be a very uncertain and unnerving time for them. I hope this deal doesn't turn into a asset stripping exercise with many jobs lost in the process but I am struggling to see differently! :(

[AltFlaps]

I understand that baby is close to sale, but I'm interested in what happens if that sale falls through?

[INKJET]

It's probably time to start new threads for baby and regional now.

[sealink]

Memo stated that bmibaby would continue into summer 2012 with current fleet and tickets for sale. Spoke with BA crew this morning and their memo stated that ba and bmi would work " together " ??

[Flypuppy]

Might be an idea to separate out from the main BMI thread....

[Flypuppy]

Inky, your wish is my command....

[INKJET]

Thanks Flypuppy

[king surf]

Totally agree Baroon--How will they sleep easy at night?

[Rougueg]

Has there been any further news for Regional since the sale was announced?

[Flypuppy]

Things will remain as Business As Usual until the mechanics of the deal are worked through. It will probably take a couple of weeks before anything will really happen.

[Count von Altibar]

At least we've got that out of the way now. If you're a bmi pilot and not in BALPA, time to join!

[Rougueg]

Ah BAU the mantra of all airlines. Either that or WAWWA (We Are Where We Are)

Cheers

[Flypuppy]

That depends on how many synergies can be leveraged while pushing the envelope and thinking outside the box.

Shall we run that up the flagpole and see who salutes it? It means we will be able to pluck the low hanging fruit :8

[INKJET]

This is a share sale where IAG will purchase 100% of bmi.

bmi Regional and bmibaby are at this point in time wholly owned subsidiaries of bmi.

[Say again s l o w l y]

I don't think there are many that aren't to be honest.

[Flypuppy]

Inky that is true but the Regional deal is distinct and separate from the mainline sale. Lufthansa as 100% owner of all the share holdings are able to split those shares as they wish.

IAG will not have any influence on Regional and they have no interest in Baby.

[Say again s l o w l y]

Inkjet, read the memo from WPS.

With respect to bmi Regional the proposed sale to a UK based investor group will continue as outlined in my previous communication. bmibaby continues in 2012 with the same fleet as currently operated and tickets are on sale for the currently published network.

[Gove N.T.]

I suppose "Old Beardie" will start "whinging" but I think he is right to question the overwhelming presence they now have at LHR.
I suggest that many of the BMI staff will now disappear if the deal is confirmed whereas with VS many would probably have stayed.
BD were hardly ever a competitor to BA - no long haul - and VS can't really be described as a significant competitor and now not likely to be because slots won't be available.
Now there are many who don't Branson's style but one has to accept that the fellow has built an airline from scratch despite the significantly criminal behaviour of Marshall & Co.
Anyone in his right mind, faced with such large competition, would be negligent, uncaring of his employees if he did not make strong representations to the competition authorities. The employee relations at VS is very good - more than can be said for BA's
I feel for the BMI team - they will be shafted - but hey all in the name of monopoly eh

[FR-]

The employee relations at VS is very good - more than can be said for BA's
did virgin back in July look like it was about to go on strike?

fr-

[Airclues]

I think he is right to question the overwhelming presence they now have at LHR.

Assuming that they are allowed to retain all of the slots, IAG will have 53% of the Heathrow slots. Lufthansa control 56% of the slots at Frankfurt and Air France/KLM own 59% of the Paris slots and 57% of the Amsterdam slots.

[pennineuk]

Whilst some routes might migrate from LGW to LHR, I am sure IAG would want to retain a presence at LGW for future expansion given the current stalling or R3 at LHR. It's the same reason BA maintain a presence in T3 at LHR- it makes flexing and growing capacity easier because you have an established infrastructure. With added slots at LHR, BA may be able to achieve medium-0term growth, but long-term LHR will always be constrained.

[Ms Spurtle]

VS never really wanted bmi
They just didn't want BA to have it.

[HOVIS]

Are there any mainline BMI staff dotted around the UK regions or are they all BMI-regional/BMIBaby employees?
I'm thinking about Engineers and Check-in staff as opposed to flying crew.

[Skipness One Echo]

Are there any mainline BMI staff dotted around the UK regions or are they all BMI-regional/BMIBaby employees?

They self handle at Glasgow (BMI Baby, Emirates and BMI Regional), Edinburgh and Manchester.

[Gove N.T.]

did virgin back in July look like it was about to go on strike?

1984 - 2011 27 years no strike
I think that demonstrates an example of employee relations that many companies would be happy with -

Nearest they came was a couple of years ago with cabin crew

July - cockpit crew? Not really that close because the difference between what was offered and what was wanted was small. I doubt a strike would have come because who wants to be out of work at a time like this?

[JonnyBfs]

What happens at BHD, is that not mainline staff?

[Rougueg]

Thats made my day!

[fishpie]

as ex-bmi, sad day, but inevitable !

Without knowing what happens to bmibaby, what is going to happen to the Engineering base at EMA and the HQ at Don Hall, will these still exist by April 2012 ?

Potentially another blow to job market in East Midlands

[xray one]

VS never really wanted bmi
They just didn't want BA to have it.

The only way VA could expand was to join forces with BMI. VA need a feeder around the UK and Europe. If this goes through then the opportunity has gone, forever.

If you add on the AA slots, then IAG has a huge, anti competitive, chunk of the market. VA would eventually either stop any expansion or even worse shrink to just 'cherry picking' routes and charter.

Either way, a bad day for BMI and the public.

[HOVIS]

They self handle at Glasgow (BMI Baby, Emirates and BMI Regional), Edinburgh and Manchester.

Skip, is that self handled by BMI mainline staff or self handled by their own group?
IE BMI regional staff handle BMI mainline flights or vice-versa?

[Cyrano]

The only way VA could expand was to join forces with BMI. VA need a feeder around the UK and Europe.

I'm afraid I've never really bought into this Virgin Atlantic feeder argument. The VA long-haul departures from LHR are (necessarily) spread out throughout the day. If you want to offer reasonable connections in both directions, you can't feed/defeed them effectively with less than 3 daily frequencies. Maybe, just maybe, this could work for the densest routes where a VA connection through LHR is competitive with the alternatives (e.g. from MAN and EDI). But from continental Europe? Sorry, but I just don't see it.

[Skipness One Echo]

Skip, is that self handled by BMI mainline staff or self handled by their own group?
IE BMI regional staff handle BMI mainline flights or vice-versa?

Mainline handle subsidiaries and third parties, all branding is BMI blue. Beyond the odd charter, BMI mainline don't fly from GLA since dropping LHR-GLA in March.

shrink to just 'cherry picking' routes and charter.
This is all they're ever done, the only routes they launched before the competition were LHR-PVG before BA and LGW-PHC, dropped when Virgin Nigeria was formed.

[HOVIS]

Thanks Skip, I suppose there are some very worried mainline staff in the regions at the moment.

Good luck to em. :ok:

[kazzie]

RE: BD handling GLA.

Bmi, BmiBaby, Regional and EK Handling:

Pax Service, Dispatch, Ticketing: BMI Mainline staff
Ramp: Servisair

[STN Ramp Rat]

to answer Hovis's post from earlier, TUPE will not apply IAG are purchasing all of Bmi and not just part of the business.

TUPE may apply internally if Bmi sell Regional to a different group. I am not aware how the structure of Bmi is currently set up but TUPE works on the principle that the staff will follow the work and therefore anyone working principly on the Regional prooduct would TUPE to the new Regional owner.

I would strongly advise any staff working on multiple products to consult their contracts of employment to see who they actually legally work for and then consider which part of the organisation that they principally work for, this should give them a good idea where they are likley to end up.

A good union rep really comes into their own in situations like this.

[andyy]

Don't usually post in here but a relatively senior BA mate of mine reckoned that the future for BMI under IAG was to keep it as a seperate airline but use it to add differentiated products/ service/ routes to the IAG portfolio rather than to merge with BA, much in the same way that they have for Iberia. There will have to be some cost cutting & there will have to be some savings generated from synergies (whiter Donington Hall???) but the brand may continue.

As a result no TUPE issues or messy negotiations over Ts & Cs.

[Airclues]

STN Ramp Rat

I'm not sure whether you are correct?

From the acas website;

TUPE applies when an undertaking or part of it is transferred from one employer to another, eg:
where all or part of a sole trader's business or partnership is sold or otherwise transferred
where a company, or part of it, is bought or acquired by another (if the second company buys or acquires the assets and then runs the business rather than acquiring the shares only)
where two companies cease to exist and combine to form a third
where a contract to provide goods or services is transferred in circumstances which amount to the transfer of a business or undertaking to a new employer.
TUPE can apply regardless of the size of the transferred undertaking, ie from large organisations employing thousands of employees to small businesses like a village shop with one assistant.

It would seem that if the business (aircraft, slots etc) are transferred to IAG then TUPE applies. However, if BMI continues to operate as it's own brand then it becomes more complicated.

Dave

[lfc84]

andyy - indeed, the purchaser is IAG NOT BA

[bad bear]

the official memo states for a transitional period bmi will operate under its own AOC

so not looking like a "stand alone" airline in IAG

bb

[HH6702]

Im i correct in thinking that that IAG group give the go ahead for IB to set up a low cost airline based in spain?

So what do you think of the following

BMI mainline aircraft A319's A320 to go to LGW to free up the 737's to then be transfered to spain?

BMIbaby to be renamed under the same brand as this new low cost carrier based in the UK operating to spanish routes??

It would then allow IAG group to compete more with easyjet and ryanair ?

Good luck to all the workers!

[clipstone1]

How about BMI will run as a separate airline under the BA AOC (having seen more than one airline on the one AOC elsewhere) and transfer the BA mixed fleet crew into BMI with all crew on the new BA T&C's, so they have crew on different T&C's working for different companies.

Paint all the aircraft in BA colours and have a sticker on the side "operated by British Midland International"??

[Wycombe]

It means we will be able to pluck the low hanging fruit

......but not before you've furrowed around in the long grass for a while looking for a solution, then circled the wagons to make sure everyone's happy with it.

Sorry, you may go back to the subject of Business Air, I mean bmi Regional now!

[lexxity]

Good luck to my ex-colleagues, you were the best and don't forget that. I hope it works out for you all.

It will be a very sad day when the last bmi fin flies out of LHR. :{

I hope you all get taken care of. Best job I ever had. :ok:

[MidlandDeltic]

Just caught the back end of an interview with Willie Walsh on ITV Central local news, and I am sure he said that the Donington HQ and bmibaby were both included in the deal.

Why do IAG want baby - or have LH insisted? I cannot see the fit at all.

MD

[EI-BUD]

Im i correct in thinking that that IAG group give the go ahead for IB to set up a low cost airline based in spain?




Vueling is part owned by IB/IAG, why would they want another loco airline in Spain, Vueling and Clickair have only merged, so cant see that happening. Besides Vueling is suitable for anywhere in Europe if that was needed.

[mathers_wales_uk]

Im i correct in thinking that that IAG group give the go ahead for IB to set up a low cost airline based in spain?

So what do you think of the following

BMI mainline aircraft A319's A320 to go to LGW to free up the 737's to then be transfered to spain?

BMIbaby to be renamed under the same brand as this new low cost carrier based in the UK operating to spanish routes??

It would then allow IAG group to compete more with easyjet and ryanair ?


Isn't Vueling one of the subsidaries of Iberia? Last week they have announced a 3 x weekly service to Cardiff starting summer 2012. Could this be a sign of things to come as the only other UK flights are from Heathrow.

[HH6702]

Could work why not?

[andyy]

Just because Baby & the Donington Hall HQ are included in the deal does not mean that they are still required in the longer term.

[Halfwayback]

I have split the original thread to save the readers re-directed from Rumours and News to reading through 70+ pages of old posts.

Halfwayback

[Flypuppy]

Douglas Fraser does seem to be getting better informed about aviation matters

BBC News - Concerns grows over Scottish air links to Heathrow (http://www.bbc.co.uk/news/uk-scotland-scotland-business-15592256)

[Ancient Observer]

The Treasury believes that it, the Government owns the slots in the UK. The airlines believe that they do, and the airports believe that they do.

Something to get Mr webb out of retirement about??

[Peter47]

If LHR isn't to get a third runway (which it isn't in the forseeable future) there is only room for one operator on domestic routes. With one operator you may well need regulation. The trouble is that EU (& UK) aviation policy is geated around encouraging competition which requires enough infrastructure. My view is that a monopoly operator could be forced to handle transfer traffic for competitors, although IAG would doubtless say that the same should happen at FRA, CDG, AMS, etc.

Some routes such as Cairo, Moscow & Saudi Arabia could make sense for VS. As part of the BA/VS tie up slots had to be surrendered (to DL) to provide competition on the BOS & MIA routes - although DL has just dropped one of the BOS frequencies. The same could happen here - I certainly can't see the transfer being allowed to go ahead without some surrender of slots.

I doubt that VS has the financial or mangement resources to take over bmi.

[runway30]

Presumably if IAG didn't want baby then it would have been disposed of before completion in the same way as Regional will be. IAGbaby doesn't sound too catchy does it? IAG also own 46% of Vueling but Vueling were walking into Cardiff as bmibaby were walking out!!!

[PAXboy]

To take the famous phrase: "It's the Slots - Stupid" To IAG, nothing else matters, slots and routes, even if they have to flip them around between fields and trade some out and in.

Look at the BA history of buying up UK regional carriers and then usurping the EGLL slots (Brymon and Manx to name but two - and there were many.)

The a/c can be disposed of the people absorbed and retired as needs be. IAG need to show GROWTH and if you buy in growth - it still counts. Not really but they will show that it does.

[Cyrano]

Presumably if IAG didn't want baby then it would have been disposed of before completion in the same way as Regional will be.

I have to disagree with that conclusion. An alternative deal for baby could easily be underway, just not so far advanced. I could imagine some language in the IAG preliminary agreement to the effect that it is anticipated that Baby will be disposed of before the final agreement is signed. The most urgent part of the whole deal is IAG/bmi mainline, to start the clock ticking on the regulatory evaluation so that BA can get their hands on the slots in time for Summer 12, so I can see why there was an urgency to move that forward. The pace of the Baby disposal is not so critical.

[mathers_wales_uk]

I don't believe that Donnington Hall will stay as the nerve centre of bmibaby or even bmi mainly as it is too expensive. With enterprise zones being earmarked around the England & Wales it maybe a cheaper option to move to one of these.

I know this is a long shot however it is possible

Vueling is a subsidiary of Iberia (IAG) and has announced that it is to operate Barcelona to Cardiff 3 x weekly from March 2012. And a week before the agreement in principle of IAG purchasing BMI. So could be the first move in a major expansion into the UK market for Vueling?

As part of the purchase bmibaby will become Vueling however the aircraft leased Boeing 737-300 / 737-800 will either be returned to the lessor or sent to Gatwick as they won't fit in with the Vueling fleet.

Due to duplication of some routes BA will be required to reduce it's fleet with the Airbus A319 of BMI and possibly some of the BA A319 being transferred over to Vueling. This will be the fleet renewal that many have called for at bmibaby.

The Airbus fleet of bmi, British Airways, Iberia & Vueling do fit well to allow for some tranfer around the IAG group.

Vueling 1 x A319, 47 x A320
bmi 9 x A319, 7 x A320, 7 x A321, (2 x A330 possibly to be moved to Iberia)
BA 33 x A319, 38 x A320, 11 x A321
Iberia 21 x A319, 28 x A320, 19 x A321, 19 x A340-300 (to be removed by Q4 2012), 17 x A340-600.

Future Growth

bmi (3 x A319 options)
BA (A mixture of options for A319, A320 & A321)
Iberia (2 x A330-200 to be leased but could use the ex bmi lease instead / 16 x A330-300, on order)

Bit of a long shot but it is very possible.

[mccdatabase]

BA can get their hands on the slots in time for Summer 12, so I can see why there was an urgency to move that forward.


In the Statement from Wolfgang he indicated that the bmi Summer 12 programme will remain largely the same as it is currently planned so my money would be on the start of Winter12 before things really change

[Artie Fufkin]

What is the likelihood of IAG simply closing Baby down?

It's a small, loss making venture with no assets. Who in their right mind would buy it?

[AltFlaps]

When's the Monarch announcement then? :cool:

[Say again s l o w l y]

mathers, the 3 X 321 orders you mention for bmi are not happening. DLH took them.

[STN Ramp Rat]

STN Ramp Rat

I'm not sure whether you are correct?

From the acas website;


Quote:
TUPE applies when..... where a company, or part of it, is bought or acquired by another (if the second company buys or acquires the assets and then runs the business rather than acquiring the shares only)......

It would seem that if the business (aircraft, slots etc) are transferred to IAG then TUPE applies. However, if BMI continues to operate as it's own brand then it becomes more complicated.

IAG is a holding company not a trading company so in this case I assume IAG will aquire the share capital in Bmi and not just the assets, therefore TUPE will not apply as there is no transfer of business. Everyone will still work for Bmi with unchanged terms and conditions. If IAG subsequently merge it with BA then TUPE would apply.

[EI-BUD]

Probably a minor detail in the scheme of things since regulatory approval not yet in place but, question re Diamond Club miles. I have significant miles built up, have been saving them up. Does anyone know if they will be transferred to LH under Star for use on Star partners or will the accounts be brought into BAs own scheme? (which changed name recently)

[runway30]

Cyrano, I agree a disposal of baby could still be under negotiation but I can't understand why WW would specifically mention baby in an interview if he didn't have a strategy for it going forward.

[stormin norman]

If IAG does aquire BMi then its first job is to stop the losses being incurred before any integration into BA mainline.

The big question is what manpower would BA need (if any) to integrate, as well as expand its own bussiness ?

One thing is for sure ,there'll be no rush to sign up the BMI managment team.

[Hartington]

How much notice does BD have to give to the various airlines it codeshares with? Does it matter whether the airline is Star or non Star?

[Flypuppy]

Despite what Pup has said, I believe that Inky is correct in suggesting that Regional would technically be in the same position as WW, were it's much more advanced disposal to fall through.My understanding is that Regional has its own shareholding, and always has. When it was purchased back in 2009, the share split was 50% SMB, DLH 30% and SAS 20%. A separate purchase was made of SMB's and SAS's shares and as such has remained a separate shareholding entity.

Much of this is academic, as I believe the sale process is ongoing and should be completed soon.

However, in the unlikely event that the Regional deal falls through, IAG would have the option to buy as there are no other serious buyers in the market for bmiR.

I could be wrong, I have been before and probably will be again, but I dont think I am too far off the mark.

WW is slightly more complicated to divorce as they are much more integrated into the BMI Group, and as far as I am aware never had a separate shareholding structure as distinct as Regional's, although I do stand to be corrected by those who would know better.

[JSCL]

BBC News - Lufthansa to sell BMI to British Airways owner IAG (http://www.bbc.co.uk/news/business-15588645)

Lufthansa has said it is selling British Midland (BMI) to International Airlines Group (IAG), which owns British Airways and Iberia.

No details have yet been given of how much will be paid for the loss-making carrier.

The airlines said they hoped to sign a purchase agreement "in the coming weeks" and complete the deal before April 2012.

But Virgin Atlantic told the BBC that it could still buy the airline.

The sale still has to be cleared by regulators.

BMI, which is based in Castle Donington in Leicestershire, operates flights to Europe, the Middle East and Africa.

The key issue for regulators will be the extra take-off and landing slots at Heathrow Airport that BMI owns.

The acquisition would mean that IAG would have more than half of the landing slots at the UK's busiest airport.

Bidding war?

But Virgin Atlantic, which has also made a bid for BMI, said the deal was not yet done.

"We have put in a bid so it is by no means a one-horse race," Virgin Atlantic chief executive Steve Ridgway told Radio 5 live.

"It is not a binding agreement and both companies are still talking to Lufthansa."

In a statement, the airline said that "British Airways' hold over Heathrow is already too dominant" and IAG's purchase of BMI would be "disastrous for consumer choice and competition".

Geoff van Klaveren from Deutsche Bank said the deal would make a big difference for IAG.

"It boosts their slots at Heathrow to 54% share from 45%. Given that no new runways are likely to be built in the South East of England in next 10 years, this is a crucial strategic move," he said.

Lufthansa bought the 50% of BMI owned by its then chairman Sir Michael Bishop in 2008, taking its holding to 80%.

It decided to sell it as the carrier's losses widened.

It reported a loss of 154m euros ($213m; £133m) for the first nine months of this year, hit by rising fuel costs and social unrest in some of its destinations in North Africa and the Middle East.

BMI also has a no-frills subsidiary called BMIBaby and the Aberdeen-based BMI Regional.

BMI announced on 28 October that it was in advanced talks to sell BMI Regional to a UK-based investor group that would continue to run it as an independent airline.

[Blowstar]

Breaking up BMI for scrap is a logical move for Lufthansa, given that it hasn't been able to establish an identity or direction for the carrier since acquiring it.

Selling Regional to FlyBe or Loganair is a no-brainer, it's a Scottish based carrier and its EDI ops base and slots, and Embraer fleet dovetail well with either of these operators.

BMIBaby may well be fought over - Jet2 has expansion plans, but Stelios's new baby Fastjet could be hungrier for the planes, even 15-18 year old crappy 737s, since they come with an ideal package of slots at EasyJet airports like PRG, NCE, FCO, VCE, MLA, BCN, AGP, ALC, PMI, FAO, EDI and GLA.

Whilst many (including me) think BMI mainline would have been a natural merger with Virgin, Virgin's business model is based on long-haul and apart from a couple of A330s and a lot of slots, would have difficulty merging BMI's fleet and crews into its own operation - it tried European flying twice before and didn't like it, the profit's in the higher fare structures and lower slot demand of aircraft kept in the air for longer.

So it's BA or bust. The advantages for BA/IAG are a couple of A330s for Iberia, and two dozen low-mileage A319/320/321s to replace the clapped out 737-400 fleet, some of which are over 20 years old (Willie Walsh, I should give Stelios a ring if I were you, they'll match his ex-Baby ones)

The advantages for Lufthansa are saddling its main competitor with a £125 million a year loss-making enterprise, and 3600 unwanted staff.

[RevMan2]

The loss of slots to IAG won't really worry LH - the current network connecting LHR to the 3 major hubs and secondary European destinations is adequate to service a mature market and the grand plans of the late 90s of using LHR as an aircraft carrier to attack BA's North Atlantic business class market dominance (the raison d'etre for the put/call deal between Weber and SMB) have long been archived.
LH gets some cash back and is rid of a long-term drain on its balance sheet.
Case closed.

Breaking up BMI for scrap is a logical move for Lufthansa, given that it hasn't been able to establish an identity or direction for the carrier since acquiring it.

It HAD an identity, never had a direction.

[Rougueg]

Is there a name to go with the Private investor group, buying BMI Regional.
Or a named individual?

Anyone in the know, know how the sale is progressing?
Have BALPA ok'd it?

Any timeframe on a completion date?

Cheers,
Rougueg

[Flypuppy]

The investor names are currently commercially sensitive so will not be released before completion of the deal.

Due diligence is continuing and should be completed before the end of November. As there is no change to any aircrew positions BALPA have no need to give their blessing to a commercial deal that will secure people's jobs.

This deal should provide much less uncertainty than the IAG deal for mainline.

Completion date is a moveable feast....

[Rougueg]

Completion before end NOV sounds v. positive.
Cheers

[TCX69]

Seems like LH is taking over LHR-TXL from bmi. Guessing this will be until BER opens when LH will operate also.


LH3127 LHR0905 | TXL1155 D
LH3129 LHR1410 | TXL1700 x1357
LH3129 LHR1415 | TXL1705 1357
LH3131 LHR1925 | TXL2215 D

LH3126 TXL0720 | LHR0825 D
LH3128 TXL1235 | LHR1335 D
LH3130 TXL1745 | LHR1845 D

Funnily though the above schedule is available on the bmi website, but the LH website still shows the bmi operated flights!

[G-AWZK]

Heard from a trusted source that Donington Hall went on the market today. Is the IAG deal moving that fast??

[davidjohnson6]

Suppose the sale of bmi to IAG fell through - what would you anticipate Lufthansa doing next ? In any case to sell a large site like Donington Hall will take time - taking vacant possession of the site need not be at the same time that a contract for sale is agreed. Bit different from flogging a flat at the High Street estate agent ! :-)

[Flypuppy]

Suppose the sale of bmi to IAG fell through - what would you anticipate Lufthansa doing next ?
Call Virgin's bluff and ask them to put an offer on the table. The slot portfolio is interesting to any number of carriers, and the middle eastern carriers would be interested in discussing a deal.

[The SSK]

The Noble Lords discuss Belfast-Heathrow ...

House of Lords Main Chamber Debates 15 November 2011 (http://services.parliament.uk/hansard/Lords/bydate/20111115/mainchamberdebates/part003.html)

[EI-BUD]

Hi SSK

Interesting information re the conversation preserving BHD LHR or the route to NI.

It is surprising that no reference is made to the fact that there is a very reliable and good service from Aer Lingus who have won a good share of the market. It is conceiveable that Aer Lingus would make additional slots available should bmi/iag decide to withdraw next year.

Yes if bmi disappeared from BHD and BA didnt assume the route the BFS LHR link would not offer the capacity that is currently required. Belfast is well served from London area and it always will be as one of the major domestic routes, though in terms of ring fencing slots, it hasnt happened for LHR flights before and I cant see it happening now, egs JER, GLA, IOM, so of which have completely disappeared.

Furthermore, if Belfast London LHR was designated a PSO , the question is then what about all the other routes like JER, GLA, IOM, PLH, MME, LBA etc. what can be said for them examples, some have been cut some have been curtailed, eg GLA...

Aviation in EU is deregulated, airlines make commmerical decisions, as they should be allowed to. I also believe that Belfast does not have as strong a case as say GLA or EDI for ring fencing slots as BFS being on a different Island will mean that air transport is more necessary and hence a stronger business case than say MAN or GLA who could have the alternative of a rail service (potentially).

[BCALBOY]

Aer Lingus also op into LHR from BFS.

If BA are successful in taking over BMI and decide not to op to Belfast in their own right , I could see them working with EI , maybe leasing them a few slots so they can enhance their current service to 6 or 7 a day though whether this would be from BHD or BFS , I don-t know.

BA did loose a lot of money previously on BFS/LHR but they were burdened with the cost of a crew base and self handling stations.Without these costs and with lower crew costs of mixed fleet cabin crew and without the competition they previously had from BMI they may find it worthwhile to op in their own right. They do get a lot of connecting traffic from N.I. even without their own service to the province and this would increase if they operated themselves.

So far as Scotland is concerned ,there is much less threat.

Edi has almost always been BA's most (sometimes only ) profitable domestic route and in fact sometimes ranked among the best on shorthaul network .There are many other shorthaul routes that would go before EDI if slots were needed.

GLA hasn-t been as strong but the economics will have changed with BMI withdrawing from the route and this is reflected in BA's recent frequency increase and the use of larger a.c including 767.

BA have announced further freq increases recently on MAN/EDI/GLA altho thid may be partly political to help its case to takeover BMI.

[Rougueg]

News this morning - From Flight Global.
Good news for Regional.

A group of UK investors, known internally as "Granite", is understood to be carrying out due diligence on the regional subsidiary of BMI.
A number of other parties are rumoured to have been interested in acquiring BMI Regional. The sale is due to close "well before" the upcoming takeover of BMI, which is likely to face competition issues and may not close until the middle of next year, according to the source.
BMI Regional operates a fleet of four Embraer ERJ-135s and 15 Embraer ERJ-145s. The airline is hoping to continue operating the five ERJ-145s it is wet-leasing from BMI, following International Airlines Group's planned acquisition of the mainline carrier, the source said.
Ian Woodley, Graeme Ross and Robert Sturman, who have prominent roles within Granite, are understood to be likely candidates to head up BMI Regional following its takeover.

[frequentflyer2]

We're due to fly bmi BHD to LHR towards the end of April, returning in May. We booked as soon as we confirmed our arrangements for a trip to Barbados. It would have been more convenient to fly to LGW but the fare offered by bmi, including luggage, was considerably lower than either Flybe or easyJet. Does anyone think bmi will pull off the route before April? How much notice will we get if this is the case? It's going to cost a great deal more if we have to re-book.

[OliWW]

How much has IAG actually brought BMI for? baring in mind of all its debts it has to buy as well

[Flypuppy]

No sale has yet been agreed ( that anyone knows of) so the price is probably yet to be thrashed out following valuations and due diligence.

[mccdatabase]

frequentflyer2


Do not worry Lufthansa have already said that the winter schedule is unaffected and the summer 2012 schedule remains largely the same,BHD especially should be ok as BA do not fly there, bmi are being bought by IAG, they are not going out of business, longer term the brand may change but you will be fine. relax and enjoy the superior level of service you will get with bmi.

[frequentflyer2]

Thanks for that reassurance. We've always enjoyed flying to LHR with bmi. It would be a pity, from a passengers point of view, if the service ended.

[waffler]

Just wondering what you pilots are doing. Whether to hope that you are integrated with British Airways or jump ship early to Easyjet or the desert before your collegues become your competitors in the jobs war.
I feel for you all as i know it would be a difficult decision for me.
Best of luck to all.

[INKJET]

Jumping ships isn't really an option when your on a 3 month notice period, more of a slow crawl.

If IAG acquire bmi and some of the slots are used for long haul routes then that will likely require more not less pilots, i can't see any pilot redundancies from LHR out of this, but until a deal is sealed and a plan set out a premptive jumping of ship would seem a higher risk than staying put?

[stormin norman]

BA could absorb a majority of the BMI operation without any extra staff.

Not everyone is going to survive this sale, whatever way it goes.

[mutualswap]

stormin normin

i think its fair to say most of us at the hall only want the answer to 1 question

"how much am i gonna get and when!!" :sad:

[Say again s l o w l y]

IAG will have to do something when they get the keys to DH. There's no way they're going to put up with the losses that the bmi group have been producing.

The Hall is up for sale. I'm predicting that it will be closed even if it doesn't get flogged.

Let's be honest, how sensible is it that the majority of the flights are going from LHR and yet the head office is so remote (in more ways than one) from the actual operation?

It's daft and DH is a mill stone, unfortunately this means that people will also lose their jobs. However, again, how sensible is it that a company with less than 60 a/c has a staff complement of 3800? That's just nuts.

There will be big changes at bmi soon and I don't think people are going to like them one little bit. However, they have to happen and WPS should have started the process years ago, that way bmi might have had a chance at remaining as a brand in it's own right.

The sale process seems to be moving at one hell of a lick. I wouldn't be surprised if it wasn't concluded before Christmas. None of this Q1 2012 nonsense that we keep getting told. Given that IAG have been talking to DLH for a lot longer than most people imagine, then I'm guessing (and my spies elsewhere confirm) that it's all over bar the shouting and bmi will be a very different place by the end of January as the chopping begins.

A crying shame, but what can any of us do about it?

[fonejacker]

Agree totally with sayagainslowly.

[MrBenip]

Sayagainslowly; Yours is the first criticism of WPS I've read or even heard about. I think the poor blokes hands were well and truly shackled regarding being able make to BIG changes to BMI. If you feel the need to apportion blame I think you should look in a different direction IMHO.

[AltFlaps]

Whether or not WPS had his hands tied, the LH team who have been in residence at the Hall for nearly 3 years has done the square root of beep all in terms of any significant change. The last big announcement (after the 105 million loss declaration) was a change of sandwiches and daily NCE out of LHR. All the sh1tty old bmi management practices are still firmly in place.

If old Wolfy was constrained, then he must be getting very well remunerated by LH to have looked like such a weak leader (and that's being mild) for the past 3 years! If we wasn't being constrained, then why the hell did LH allow him to stay in post?

When the dust settles, if he gets his triumphant return to OS with a senior role, then we'll all know what really happened.:(

[Say again s l o w l y]

MrBenip, if this is the first criticism of WPS you've heard, then you haven't spoken to many bmi people.

He may have had his hands tied, but at the end of it, he's the bloke in charge and so bears the responsibility for the complete and utter failure of the turn around strategy.

Do you think IAG will keep him on after the deal is done?

[ayebmi]

I had WPS on a flight recently and he basically said that he DID want to persue what he saw as the glaringly obvious need to expand into longhaul and take on the big boys with a superior product a la Moscow, but there "There was just no money made available to get some longhaul aeroplanes" so I'd say his hands were tied and that he came here with a vision of making bmi a real player but things have just not gone his way.

[Say again s l o w l y]

That was only put to the DLH board recently. It should have been the strategy from day one. A bit like the project Greenfields that was put together recently to look at what the company should look like if starting from scratch.

It was a good idea, just 2 years too late.

I could be absolutely savage about what I've seen at bmi, but it would be pointless since IAG will be taking over and they'll do whatever they decide and me running down a company that I've really enjoyed working for (until recently, as I liked thinking I was doing something to help, now I realise that whatever I do is fundamentally pointless. I'll carry on and do my absolute best until it's all sorted out of course, but everything is taking foorever as most people are just in shell shock.) will not help one little bit.

As I've mentioned before. bmi is a lovely place to work and the people there are amongst the nicest I've ever worked with. It's just a shame that these people have been let down so badly. It's not the Senior management that holds all the blame. DLH need to understand that they've had a major part in ensuring that this was inevitable.

Like most aviation screwups, it's not one thing that's caused the final problem, but a series of smallish stupid things that have just added up to disaster.

[G-AWZK]

Yours is the first criticism of WPS I've read or even heard about.there is enough on this thread alone.
WPS has not exactly been the most dynamic nor most visible leader I have ever worked under.

Had the leadership been more determined from when they walked in the door, and it would not have required a management guru to figure out where the reorganisation should have started. What happens from here on in wont be good news for many, which is rubbish given the time of the year.

For how IAG handle things, it might be worth reviewing how BA handled the absorption of BCal.

[Jack1985]

Im just wondering how many slots bmi holds at Heathrow including the bmi regional operation? also with regards to slots at Heathrow does a single slot include departure/arrival say for a daily service? if someone could explain the LHR system to me it would be great :ok:

[look you]

Slots come in "pairs". Each pair entitles you to perform a take off and a landing at specific times. The slot doesn't constrain the destination, that is down to route licences.

bmi have approx 59 pairs, Regional have none, they operate some of bmi's slots on a wet lease.

Slots are administered by a company called ACL. If you want to know more start with the link below:

Airport Coordination Limited - Heathrow Airport (http://www.acl-uk.org/default.aspx?id=54)

That's about it really.

[Jack1985]

So if bmi have 59 slots and planned to use all of them daily is that meaning 59 arrivals & 59 departures are allowed each day to any destination which has a licence?

[max nightstop]

yep, that is correct

[bread&water]

Can anyone help me with an estimate of current BMI pax numbers at Heathrow - perhaps split domestic / interational or by route ? Thanks
B&W

[Musket90]

Breadwater

If you check Airport Co-ordination web site and check reports/statistics for Heathrow winter 2011/12, it states movements and no. of seats statistics for BMI, but not split for route detail.

[nivsy]

and even then it is still probably not a true reflection on who is travelling on what metal!

Interestingly having just booked recently a trip to Berlin ex LHR - the Lufty site says operated by BMI and the BMI site says operated by Lufthansa!. If the carriers dont know then there is no chance for the poor pax.....


Nivsy

[Nubboy]

Likely to be operated BY BMI on behalf OF DLH

[EI-A330-300]

Can somebody please explain to me what kind of people run the bmi schedule dep.

They applied for 5 daily LHR -DUB slots at DUB with the 6.45 and 6.50 departure on Saturdays next summer and received the slots as well as the extra Saturday morning slot.
They updated the Airport systems in Dublin to represent it and a few days lather they cut the route to 4 daily M-F three on Sat and 2 Sun.

Bye the way there were lucky to get the extra Saturday slot which all airline want the early slots and Saturday is probaly the bussiest day for morning slots. 4 other airlines wanted it and when bmi were granted it they decide they don't want it and have yet to imform the airport of the changes.

[Panther]

Just heard on Radio 5 wake up to money that they are reporting Virgin has put in a "fast and low" bid for BMI group..........Did some digging on The Times website, and they are reporting that virgin have started due diligence on their bid. Maybe its just a spoiling tactic to stop IAG getting control of those LHR slots but IMHO I think this time they are serious.........

[queenvic]

virgin bids £50m

http://www.reuters.com/article/2011/...ufthansa-bmi-idUSTRE7BB01Z20111212

[Flypuppy]

Link doesn't seem to work queenvic. Try this one
Virgin Atlantic Makes Rival Bid for Lufthansa’s BMI Unit in U.K. - Businessweek (http://www.businessweek.com/news/2011-12-12/virgin-atlantic-makes-rival-bid-for-lufthansa-s-bmi-unit-in-u-k-.html)

[Rougueg]

Any news on the BMI Regional sale? All seems to have gone very quiet since the big announcement start of November.

[stormin norman]

If its £50M then you wonder what IAG must have bid.

LH will probally take the best cash offer on the table.

IAG and Virgn may yet team up and hold out for a fire sale.The economic climate will be putting pressure on LH to sell as fast as possible.

[Flypuppy]

Rougueg
The process is continuing, albeit a little slower than anticipated. Hopefully all will be tidied away by the end of this year. :ok:

[mart901]

Is bmibaby going seperately or with bmi regional?

[EI-BUD]

No surprise here with VS. The purchase of Northern Rock for £747m by the Virgin group is symbolic and I can see the government stating that IAG/BA buying bmi is not in the interest of the consumer (despite fact that in AMS FRA the national carrier are bigger than BA is at LHR in terms of share).

EI-BUD

[jdcg]

I can't see the Gov being that concerned about IAG taking over BD as the only other potential BA have to expand from London is the remote and contentious possibility of the Thames Estuary airport, which BA don't want. How can they grow their business in the UK without more capacity at LHR? The collusion that there has been on air fares over the years would seem to suggest that it doesn't matter whether there is a competitor or not, the consumer will get stuffed anyway.

[Flypuppy]

Mart901

Any bmiBaby sale will be independent of the Regional deal.

[mart901]

Cheers for the answer, in some ways that makes bmibaby more likely to remain as a brand rather than being swallowed into the new owners, although who knows. I could see them going to private venture capital for a few years and then being sold to another airline and re-branded.

[queenvic]

reported that IAG bid £100m, Virgin £50m but virgin bid would avoid any competition commission probe making it a quick sale.

We are all sick of not knowing whats going to happen and just want our future decided!

[LD12986]

I think it's a spoiler to drive up the bid price and make like difficult for IAG. I just can't see Virgin having the financial muscle to make a go of integrating bmi. It's telling that Virgin seem to have only got their act together after the IAG announcement. Also remember neither bidders have finished due diligence so they don't know yet what exactly it is they are taking on.

I don't think IAG will take a counter bid from Virgin lying down either.

[Capetonian]

I've noticed that the loads on quite a few BMI European flights are very low indeed. Am wondering if this is some kind of strategy to drive the sale value down?

[vctenderness]

The trouble is that Virgin is all for more competition - as long as it is them that provide it!

In every sphere that the Virgin brand operate they moan and complain at every turn of the coin.

I remember when they set up Virgin Radio 'The Bearded One' was demanding that the BBC gave up some of their FM frequencies.

They complained about Pepsi and Coke with the Virgin Cola.

And MATES sent someone around to the DUREX factory with a pin:sad:

[stormin norman]

IAG have yet to conclude the deal so its still anyones to buy.

Virgin might look at this deal as a way of cheaply increasing its own value before putting itself up for sale next year.

[nigel osborne]

I have to curse Virgin, not interested initially then limply coming to the table at the last second more in protest with BA/IAG than real interest perhaps.:oh:

All that has done is make the poor workforce of BMI/Baby have to wait even longer.

Have crossed out flying with Virgin next year:ok:

Nigel

[davidjohnson6]

As many are aware, while Virgin are coping at the moment and not in any serious danger right now, Virgin is not having a brilliant time with regards to recent financial results.

Suppose Virgin win the bid for bmi. One of three scenarios would likely then ensue:
a - Virgin manage to turn bmi around and absorb it into their operation without too many problems
b - Virgin has difficulty absorbing bmi, but it all works out eventually
c - Virgin realises they have bitten off far more than they can chew, and face serious financial problems.

If scenarios a or b happen, then all is OK.
Under scenario c, what happens next ?

[LD12986]

If scenarios a or b happen, then all is OK.
Under scenario c, what happens next ?

Leaving aside issues of personal pride, it may depend in part on how the deal is structured. Bearing in mind Virgin Atlantic is 49% owned by SQ and Virgin's acquisition appears to be supported by third party funding, bmi may effectively remain a separate airline with its own AOC in part for structuring reasons but also to keep Virgin Atlantic ring-fenced from any risk of the bmi merger failing.

[The Big Easy]

And that third party funding is who exactly? Got to be either Etihad or Qatar I suppose!

[LD12986]

It is claimed it is a Middle Eastern backer - don't know if this is an airline or an investor.

[xray one]

Virgin will not, and could not, go this alone. A tie up with a Middle Eastern outfit would be most likely and not to the liking of AIG or Lufty. So the other option would be for Lufty to keep a share in BMI, or even buy a share of VA. This type of deal was thought to be on the cards a few years ago.

What ever the outcome, i hope it's sorted soon, and wish all at BMI well.

[Chidken Sangwich]

I understood that Etihad were sniffing around Astreaus a couple of months ago, so maybe this could be a quick route into the UK as it was alleged that they were interested in starting a UK operation?

[Facelookbovvered]

The various articles and business news bulletins that I have read suggest that it is SIA that are funding this bid through VS, SIA are of course a star airline and in acquiring bmi VS would likely become a star partner airline.

A deal with VS would probably attract less completion scrutiny than a IAG deal and therefore likely to be completed much more quickly, bmi is probably loosing £15+m a month in winter all of which is on DLH group accounts so even selling bmi to VS for half the reported IAG figure makes sense if it can be completed quickly and that is before you take any strategic value of star at LHR.

Selling to IAG would weaken star at LHR conversely brining Virgin into star at LHR would weaken BA.

I suspect DLH will make a choice before the end of this month, I think Virgin could win this unless IAG are willing to pay a substantial premium.

Whoever wins this battle could the loose the war! there seems to be little money to be made on short haul European flying these days and only BA have the international network to take advantage of extra slots and absorb bmi 319/20/21 into their short haul or LGW fleets or Iberia low cost start up.

Where would virgin get suitable aircraft from? There is a world wide shortage of 330's no chance of 380's, 777 would require expensive and time consuming re training ditto 747 although there are probably ex pats in the sand pit that would head West!:cool:

[LD12986]

There's not a chance of SQ funding these deal. They've wanted out of VS for years.

I think what is of benefit to Star is also a misnomer.

[Capetonian]

in acquiring bmi VS would likely become a star partner airline.

A complete non sequitur, I think. To use an analogy I read yesterday, if you mix a litre of milk with a 3 litres of sewage, you end up with 4 litres of sewage!

[Granite City Express]

Was speaking to a ground engineer, he was saying that the deal will be signed off on Friday and Virgin will get Mainline. God knows where these guys get their intel.

[4468]

IMHO there is absolutely no chance whatsoever of Virgin buying BMI. That then begs the question of why they are sticking their nose in at all? There are at least a couple of plausible scenarios outlined in previous posts.

If Virgin actually DID buy BMI, it would likely result in carnage for both workforces, because they can't afford it, and they can't turn it round without sustaining massive losses!! (Why on earth would SQ want to chuck good money after bad? and DLH have absolutely no appetite for allowing any mid east carrier into their own backyard!)

As it is, BMI could also be a poison chalice for the workforce of BA/IAG!

All will be revealed soon enough, in the meantime, enjoy Christmas!

[JSCL]

The big fall of BMI is lack of long haul connections at LHR. I think you're all being blinded a little. If Virgin do gain BMI, there is actually better chance of a success story than an IAG merger. Virgin has its on financial muscle behind it. The beast created by the merger could be quite a substantial one, which stands a fighting chance against BA. Strip away a lot of the med haul stuff and connect where needs to be connected from LHR to eastern and central Europe and integrate a much bigger long haul beast due to the access to slots.

I would say Virgin has a good chance of turning BMI around in two to three years. They just need to suck it in for a while.

[22/04]

Is it Vrigin Group or Virgin-Atlantic bidding? If the former then SQ is irrelevant.

[Skipness One Echo]

Where would bmi connect to? Revamp / drop med haul again? Which routes? Head to head with STAR and IAG and somehow this mad strategy loses less money than today? Honestly JCSL, name three short haul routes bmi could launch from LHR? They got out of all the core markets years ago. Back to AMS, CDG, BRU? How about MAD? LIS is covered by TP, Greece by Aegean both STAR partners. Maybe not, VIE? OS on there, ZRH/GVA covered by SWISS, nowhere German seems likely..... Once you get specific, it's hard to see what markets bmi could realistically feed VS from!

[JSCL]

Eastern Europe, underserved by LHR. If there was a potential feeder route network that could work, including some eastern Europe destinations would work.

I would never suggest BMI try in core locations like MAD, CDG, BRU etc.... Virgin whether it be Group or Atlantic can make BMI work, lots will be stripped for long haul either way, but it's going to stand a better chance (for jobs moreso) in Virgin hands.

SRB is used to running Virgin branded co's at a loss for 3-5 years to make them work in the long run.

[davidjohnson6]

Granted, Poland, Czech Rep, Slovakia, Hungary, the Baltic 3 and the former Yugoslavia have relatively few long haul flights given the number of people who live there. Let us suppose for the moment there is a pent-up demand for long haul flying from these countries. Let us also suppose that there is significant London-E. Europe demand which doesn't already use or doesn't want to use Wizzair from LTN (169 flights per week from LTN in May 2012 excluding beach cities) or Ryanair from STN.

For someone living in a large city in central / east Europe, what advantage would a combined bmi / Virgin have compared to AF-KL or LH ? AF and LH groups already have more routess at a higher frequency currently in place than VS-BD would ever manage, and neither MUC, FRA, PAR or AMS is exactly short of long haul flights. Flying from eastern Europe to major airports in Asia via LHR is pointless compared to flying via MUC / FRA - adds an hour flying time each way. If VS-BD were to try to serve the eastern Europe - transatlantic market, I suspect LH+LX+OS / AF-KL would just walk all over them.

[JSCL]

So you are suggesting because CDG, AMS and FRA exist - tring to compete on routes shouldn't happen? if that were the case. BA would be down the swanny. BA already competes on a lot of the routes also available from those three other EU hubs, no reason a VS/BD tie up can't compete also.

[Artie Fufkin]

Well if the ground engineer says so, it must be true!! :)

[Cyrano]

So you are suggesting because CDG, AMS and FRA exist - tring to compete on routes shouldn't happen? if that were the case. BA would be down the swanny. BA already competes on a lot of the routes also available from those three other EU hubs, no reason a VS/BD tie up can't compete also.

BA is an established competitor in the markets you mention. For e.g. Central/Eastern Europe to North America, BA, AF/KL and LH (including LX/OS) are already competing, as are (to a lesser extent) SAS, LOT, Air Baltic, and CSA.

A VS/BD tie-up would be starting from scratch with zero sales presence in those Central/Eastern European markets and an array of competitors more than happy to make life hard for them. Plus - as I've said before - to get reasonable connections to/from VS long-haul, you need 2, probably 3 flights a day on the short-haul network. That's a lot of capacity to suddenly throw into secondary markets.

You assert that Virgin has its on financial muscle behind it . My impression is that Virgin has always been adept at lining up Other People's Money, and I suggest that most non-airline investors would be likely to look at a Virgin/bmi scenario and say "not for us, can't see a way to make it work." Running at a loss for a couple of years in order to establish a sustainable profitable position is fine; getting into a bleeding contest with a number of large blood banks (to paraphrase the old analogy) seems less smart to me.

[Skipness One Echo]

So you are suggesting because CDG, AMS and FRA exist - tring to compete on routes shouldn't happen?
no reason a VS/BD tie up can't compete also
There are compelling reasons. I remind you British Midland made these particular routes very successful up to the coming of the locos when they became unprofitable and were dropped due to mounting losses. If you go back onto core European capital routes, I suspect losses will be at the same level if not greater as VS / BMI have no presence in these markets and are going in cold against BA, KLM and er Lufthansa. You would have to offset those massive and continuing losses, particularly in the current market against the added losses of integration and delayed cost benefits of merger synergies. You would need a load of cash, something SQ IMHO be unwilling to throw their way.

[LD12986]

Regarding connections to VS long haul, another complicating factor that VS long haul departures are spread right across the day so to offer competitive short-haul connections you need a good level of frequency on every feeder route, which could bleed millions in cash.

Virgin also does not have deep pockets. They rarely stump up much of their own cash. Any deal will be financed by someone else, and that won't be SQ.

Virgin may find a willing financier, but in the absence of any guaranteed financial return or brand recognition, I can't see what would be in it for them.

[INKJET]

If we start with what's known:

DLH. Put the bmi group up for sale, both IAG & VS expressed an interest, meanwhile bmi regional is sold to Granite aviation ( STC) DLH sign a none binding agreement to sell to IAG again STC , VS return with new offer and DLH sign a sale agreement with them also, both IAG & VS are share sale transaction to buy 100% of the bmi group ie including bmibaby & bmi regional but both aware that bmir & baby are in talks with other buyers.

So why would DLH consider VS new bid as serious after having agreed a sale STC with IAG? Why would VS go back with a new offer, but still reported as 50% of what IAG and why would DLH sign a sale agreement allowing VS to carry out DD, banks and advisors fee's will run into millions for VS so one has to assume it's not show boating.

My own view is that VS & DLH suspect that the IAG deal could get called in by the CC the VS should face no such worries and DLH want shut of bmi before year end, the IAG deal could take 6 months or more if called in and might fail if the CC put a requirement on IAG to release slots to other parties over concerns about Scottish air links and a BA monopoly on those routes.

All things being equal( but there not!) I would think DLH would prefer a sale to VS over arch rival BA/ IAG. So could go either way and too close to call, but getting off the fence I'd go 51/49 in VS favour simply because the delay cost risk is much lower and I think the bmir & baby sale will go ahead whoever DLH sign with.:confused:

[LD12986]

I suspect the reason for Virgin being late to the party is because of securing financing. No one knows just how solid the financing is, bearing in mind due diligence has not completed. Bearing in mind the VS offer is reported to be 50% of the IAG bid suggests it isn't backed with unlimited cash

LH is of course happy to entertain an offer from VS as it strengthens its negotiating position with IAG.

Due diligence is expensive but even if Virgin aren't successful they will acquire knowledge of bmi's business and markets which will have some ongoing value to the business.

[Nubboy]

Not until it's confirmed by the caterers:=

[Skipness One Echo]

The only reason VS are bidding at half the price of IAG is so they can mount a PR offensive saying "Look at us fighting against big bad BA who have gobbled up poor BMI in an unfair manner" when Lufty sell to IAG. Can you imagine the colour of Steve Ridgeway's face if he really had to turn around BMI, something Lufthansa wasn't even close to doing?

How many connecting passengers will be jumping on VS transatlantic from BD mid-haul? Part of me almost wants VS to win as finally they'd have to deliver on a contract rather a press release for once.

[6chimes]

Virgin don't want bmi. They couldn't turn it around or absorb it without massive, massive investment from the Middle East, over several years. Would Lufthansa want those very very deep pockets with such a slot foothold in Europe? There may be some routes they'd like, but 'wishing' is very different from 'doing'. Anyway, the routes they might like wouldn't use much of the slot portfolio.

They do want the slots on the cheap though.

The plan for a substantial feeder network is again a misnomer. They've been at LHR for years. Plenty of time to have created one.

They're after the scraps thrown at them by the regulators, which will be significantly cheaper than if they'd have set up a network. Everything they spend now is a cheaper alternative to buying the slots on the open market. They may well seek to operate a subsidised short haul domestic feeder, and keep a couple of mid haul routes. But that would be it. Way less than 50% of the slots.

6

[Cyrano]

They're after the scraps thrown at them by the regulators, which will be significantly cheaper than if they'd have set up a network. Everything they spend now is a cheaper alternative to buying the slots on the open market. They may well seek to operate a subsidised short haul domestic feeder, and keep a couple of mid haul routes. But that would be it. Way less than 50% of the slots.

6

I think you're right. The regulatory remedy will not be a generalised slot handback - as already stated, the combined IAG/bmi would have a lower share of slots in LHR than AF in CDG, LH in FRA, etc. I believe the remedy will be the surrender of slots to allow a new entrant to operate those routes which would otherwise turn into monopolies as a result of an IAG/bmi merger. The main ones are LHR-MAN and LHR-EDI, and perhaps a handful of mid-haul routes like LHR-CAI and LHR-DME. I could (just about) imagine VS deciding to pick up a couple of A320s to operate MAN and EDI, with a strong emphasis on feeder traffic. And the likes of DME as well? Why not? After all, IIRC, VS lost out to BD in the scarce capacity hearing a few years back for the right to fly to Moscow.

If doing the deal fast is important to LH, you can be sure that their lawyers are already deep in discussions with the competition authorities and have already made a pre-emptive offer of slot handbacks with a view to getting a fast green light from the regulators. It's worth giving up a couple more slots if it gets a heavily loss-making company off your hands a few months sooner.

C.

[Granite City Express]

Heard today that Granite Aviation (no relation..!) have yesterday signed a deal to buy Regional. Anyone know if this is the case?

[ashimashi]

Quick question WRT BD931/932:

What is the status with stopover these days? Does BMI still have refuelling stopover in Yerevan both ways, or does it go straight to IKA sometimes (depending on load)? Or are they picking up PAX For LHR/EVN and EVN/IKA route regularly now and make a stop over always?

Thanks. A.

[xwindflirt]

Due to the fuel situation, bmi always tech stops. At present they no longer nightstop in Tehran.

[Capetonian]

Discussed here :
http://www.pprune.org/airlines-airports-routes/311882-bmi-112.html#post6303532

and here :
http://www.pprune.org/airlines-airports-routes/311882-bmi-112.html#post6303580

In response to my question when I flew the route earlier this year. We stopped in Baku eastbound and Prague westbound.

[Flypuppy]

The caterers tell me there may be some truth in this.

[ashimashi]

Thanks all for your replies. That renders them out of question for my travel plans then!

I wonder how are they going to be able to compete with THY, DLH, KLM, EK, EY etc then, none of them having to have forced techstops! I think they are solely competing on the basis of price now but is it going to be worth their while?

[4468]

Just wondering how BMI guys are expecting/hoping to be incorporated into Virgin/BA??

[PAXboy]

Sorry to be a doom sayer but: The chances of BD existing in their present form in 1 Year are slender - in the extreme.

The value is in the slots and routes and some of the staff and, depending on how it's financed, selling off the premises and equipment. BD on it's own cannot compete downwards with the LCCs nor upward to long haul. It will get squeezed out. IAG only want the slots (and mebbe some routes) because that's the way they have really grown in the last 25 years, buying up and spitting out smaller carriers. Since it worked for them in the past, they will presume it will work for them again.

Assuming that someone DOES buy it, we can but hope that not too many staff lose their jobs. Of course, the support and admin staff will lose the most.

[mutualswap]

4468

we are just sat waiting :bored:

there is only 1 question the people at the hall are asking and thats
"how much will i get and when" :rolleyes:

happy Christmas! :\

[pennineuk]

LHR-MAN used to be one of BA's most profitable routes a long time ago, but not so today. BMI can't rteally make it work and today's BA services are a shadow of what they were, because of fierce competition from the train (Virgin as it happens at present). With a service every 20 minutes and a 2 hour journey time city-to-city, the airlines can't compete for domestic travel. A large part of the LHR-MAN is now connecting traffic.

Therefore, (sadly) MAN is not a prize worth winning (or giving).

EDI might be different!

[BCALBOY]

LHR/MAN ,unfortunately ,has not been one of BA's most profitable routes , certainly not in the last 25 years , if ever. ( even looking at the shorthaul side let alone the network ). Its raison d'etre , has also been to feed traffic connecting on to the rest of the network .Not only did it have one of the highest % of connecting traffic on domestic and shorthaul as a whole but a fair part of these connecters where high yield Premium psgrs
In its heyday in 80s/90s there was also a lot of pt to pt necessitating 767s on peak rotations but this was killed off by a combination of shorter rail journeys and the increased checkin times and processing times on such a short sector post 9/11.Therefore the route has shrank back to mainly connecting.

A lot of BMI traffic is also connecting , most likely to *A partners and the demise of a BMI operated service will probably see this traffic migrate via other *A gateways rather then to BA.I don-t think BA will alter freq/capacity significantly unless they have to politically.

EDI is different as you suggest.
It has consistently been the top domestic performer with a high proportion of high yield pt to pt though connecters area also significant.
BA would need to increase frequency / capacity on this route in the event there is no longer competition on this route in order to satisfy demand.

I guess this is a bit off thread (BMI).

[Granite City Express]

I believe there will be yet another announcement tomorrow :rolleyes:

[AltFlaps]

I don't think it will be just another announcement ...

Rumour has it that bmi Group will tomorrow reveal who their new masters will be :ooh:

[Say again s l o w l y]

Anyone who hasn't worked out who it is, needs help!

[Tiger]

IAG I guess..

[Say again s l o w l y]

Maybe...

Maybe not...

[The96er]

Say again slowly - If you're going to talk in riddles, then don't bother unless you have something definitive to add to the forum.

[Flypuppy]

If I were a betting man, my money would be on IAG.

[JSCL]

The betting man is usually the victim of believing the obvious odds.