BA in bid to take over BMI

British Airways has entered talks to buy BMI, the second largest carrier at Heathrow Airport. BA Chairman Martin Broughton has held talks in Germany over the weekend with Lufthansa, BMI’s parent company.

However BA has declined to comment on the speculation.

A number of airlines, including Virgin Atlantic, are also thought to be interested in buying BMI – but this is not the first time that the same carriers have expressed a similar interest in the carrier.

Rumours leaked that BA was planning a £1 billion takeover of BMI in 2007, after it emerged that BMI’s ex Chairman, Sir Michael Bishop may sell his 50% share in the carrier.

BMI would be an attractive proposition for any airline attempting to establish a transatlantic presence, since it owns 13% of Heathrow’s take off and landing slots, which penetrates the US.

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An acquisition of this nature would be one way for BA to gain more slots at Heathrow which has also announced plans to merge with American Airlines.

The Financial Times reported that BA’s CEO Willie Walsh said the airline would consider purchasing BMI’s slots at London Heathrow if they became available, “In the current environment, it is difficult to argue we should go out and acquire those slots. Having said that, it may be the only opportunity we ever get,”

If the acquisition were to go ahead, BA would become the dominant carrier domestically and on a number of routes from Heathrow. However this could be bad news for passengers as it may lead in a hike in ticket prices.

It is thought that this deal would have no impact on BA’s discussions to acquire Spanish carrier Iberia.