Bmi takeover expected to get greenlight today
British Airways’ parent IAG is expected to get the greenlight this morning for its takeover of bmi.
The European Commission is expected to agree to the deal after BA reportedly relinquished more landing slots at Heathrow in order to get a quick approval.
It is believed that IAG originally agreed to give up 10 pairs of bmi’s 56 slots, but then increased its offer to 14, although this has not been confirmed by the group.
The £172.5m takeover has been fiercely opposed by BA’s rival Virgin Atlantic, which claims it would severely damage competition on key European routes.
Yesterday, Virgin president Sir Richard Branson sent a personal letter to the Commissioner of Competition, Joaquin Almunia, warning of the "irreversible damage" that IAG’s proposed purchase of bmi could cause British aviation.
"The remedies provided by BA in its alliance with American Airlines proved completely ineffective. The same mistakes cannot be allowed to happen again," he said.
"BA’s proposed competition remedies to get this purchase cleared are woefully inadequate and will ensure that BA continues to control all of the key domestic and some international routes. I am really battling to understand why the commission seems to be bending over backwards to clear this deal at phase one rather than submitting it to the proper scrutiny intended in phase two of the clearance process."
According to the financial press, bmi’s parent Lufthansa has been warning that it would have to shut down bmi if the Commission decided to hold a lengthy investigation.
Meanwhile, IAG has expressed interest in taking a stake in BA’s Oweworld partner JAL.
The Japanese airline is poised to re-list on the Tokyo stock exchange.
In a statement, IAG said: "JAL has done a great job in restructuring its business. IAG would look closely at investing in JAL and wouldn’t rule it out at this stage."
by Bev Fearis
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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