IAG beats Virgin to BMI
By John Reynolds, marketingmagazine.co.uk, Thursday, 22 December 2011 09:38AM
British Airways owner IAG has won out against Virgin Atlantic and has agreed to buy BMI from Lufthansa for £172.5m and could now sell off the airline's regional and low cost off-shoot brands.
Lufthansa had held talks with both IAG and Virgin Atlantic about a possible sale of the airline, which reported a £130m loss for the first nine months of the year and employs more than 3,500 staff.
IAG has not ruled out job cuts following its purchase of BMI, but said that restructuring costs would be spread over three years.
As part of the deal, it has the option of selling of BMI Baby, its low-cost brand, and its BMI Regional business.
Willie Walsh, IAG chief executive, said: "Buying BMI's mainline business gives IAG a unique opportunity to grow at Heathrow, one of our key hub airports. Using the slot portfolio more efficiently provides the option to launch new long-haul routes to key trading nations while supporting our broad domestic and short-haul network."
The deal, which includes BMI's highly prized runway slots at London's Heathrow airport, will be subject to clearance from competition bodies.
Sir Richard Branson, chairman of Virgin Group, said: "BA is already dominant at Heathrow and their removal of BMI just tightens their stranglehold at the world's busiest international airport.
"We will fight this monopoly every step of the way, as we think it is bad for the consumer, bad for the industry and bad for Britain."
Follow John Reynolds on Twitter @johnreynolds10
This article was first published on marketingmagazine.co.uk
- IAG forced to take on bmi baby as airline takeover completes
- Virgin Atlantic to appeal against BMI takeover
- BMI marketers' jobs at risk in £173m BA takeover
- Air tax hikes will 'undermine' Olympics, says BA chief
- Branson seeks to block BMI takeover by IAG
- Bmibaby sold to mystery buyer
- BA brings in Emin to oversee London 2012 'dove' project
- Willie Walsh plots stable of strong brands under 'boring' umbrella group
- British Airways owner in grab for BMI
- ACCOUNT DIRECTOR - SOCIAL MEDIA - Integrated agency - London - £40-45k Judi Patton £40k-£45k, London
- Russian speaking PPC Manager Michael Page Digital £35000 - £40000 per annum, Middlesex
- Direct Marketing Executive Michael Page Digital £13 per hour, Cambridge
- Digital Marketing Executive Michael Page Digital £22000 - £30000 per annum, Bournemouth
- Fashion Account Director Michael Page Digital £45000 - £50000 per annum, London
Chronicles of Cannes – The Arrival
The annual advertising hajj that is the Cannes Lions has kicked off in a steamy haze of rosé, Brazilians and flashy boats. Twelve thousand delegates are desperately seeking out free drinks in between trying to squeeze into packed talks by a mix of celebs, industry legends, wannabes and hasbeens.