Virgin considers BMI hook-up

Virgin Atlantic is reportedly considering a bid to takeover bmi in a further instance of consolidation in the aviation industry.

The Telegraph reports sources close to the airline as indicating that financial giant Credit Suisse has been brought in to oversee a potential deal.

Despite no talks being confirmed between Virgin and bmi, or its major shareholder Lufthansa, the involvement of Credit Suisse is seen by experts as a marker of Virgin's intent.

Sir Richard Branson, Virgin chairman, told the paper that a link-up with bmi was potentially an important step given the current global aviation market.

"There is considerable logic in Virgin and bmi working as one," he said. "We do not overlap on routes, would give us a good short-haul network and give them a good long-haul network".

"By doing that it would create a more formidable competitor to British Airways," he added.

Lufthansa can also take full ownership of bmi, although a planned option for leading shareholder Sir Michael Bishop to sell his stake to the German carrier runs out in 2009.

Experts believe that bmi is seen as a prized asset for potential suitors as it has the second highest quantity of take-off and landing slots at Heathrow after British Airways.

Sir Richard continued as saying that "we are watching the situation. Michael really doesn't have anything to do with bmi anymore in that he has effectively given up a decision to Lufthansa over future ownership".

Virgin also recently reportedly a 38 per cent growth in profits with the airline pointing to increased business travel customers as contributing to this.

Airline News posted on 01 September 2008

Comments

Really

Omg i didnt know that but oviously i do now. When i am older i want to work as cabin crew for virgin atlantic. lol thought you might of wanted to know.

Comment posted by Anonymous on 21/09/2008 09:56:00