BMI pins hopes on £100m restructure to thwart break-up

15th Apr 2010
BMI pins hopes on £100m restructure to thwart break-up

BMI expects a major restructuring programme will halve losses this year, and save the airline from imminent break up.

The £100m plan aims to reverse the fortunes of the UK-based carrier, which suffered a £156m loss last year. It will include 800 redundancies, cutting the aircraft fleet by 10 and axing unprofitable routes.

In his first interview since taking the reigns at the airline last October, Wolfgang Prock-Schauer, said the airline would be kept as a going concern.

“We have no intention of breaking up BMI. It will be here to stay,” he told a delegation of reporters in London.

However he added that he could not rule out a possible sale of BMI, which is owned by Lufthansa, in the long-term due to the volatility of the aviation industry.


“To say now the door is shut forever would be not right because there are so many combinations going on,” he added.

“Right now, the focus is on restructuring and then we’ll see what kind of opportunities arise later. We want to create a valuable asset for the Lufthansa group and the owner can always then make the assessment of what to do with this asset.”

Plans on the table include increasing flights to continental Europe and North America, although this was only an option at this stage.

If there airline were to broken up, British Airways would be one of the front runners. BA chief executive, Willie Walsh, is particularly keen on BMI’s 10 per cent of the take-off a landing slots at Heathrow, the highest number of any airline after BA.

Virgin Atlantic has also expressed an interest, and has held regular talks with Lufthansa about the future of BMI.

However Prock-Schauer said no talks were taking place at present as the group focuses on restructuring.

Prock-Schauer confirmed that, BMI had sold a number of slots to other airlines in the Lufthansa group, which includes Brussels Airlines, Austrian Airlines and Swiss.


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