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IAG gets approval for BMI takeover

IAG gets approval for BMI takeover

British Airways’ parent IAG has secured approval for the takeover of BMI from its current owner Lufthansa.

The European authorities confirmed the deal after IAG agreed to give up seven slots at Heathrow Airport.

IAG will pay £172.5m ($273m) to buy BMI in a deal that was agreed last year.

The deal is expected to be completed around April 20th.

IAG chief executive Willie Walsh said: “We’re delighted the EC has given competition approval for our acquisition of BMI.

“Their decision follows a thorough review during which the views of key stakeholders have been taken into account.

“This is great news. Over time we will launch new long-haul routes to key trading nations that are currently not served from Heathrow while supporting our short-haul network.

“This is good for UK business and UK consumers. We have already announced that British Airways will re-start flights from Belfast to Heathrow, maintaining important economic links.

“Expanding our longhaul network also helps Heathrow grow as an international hub airport despite its infrastructure constraints.

“This deal will maintain high quality jobs at bmi and create similar jobs when we expand. More British jobs will be saved than if bmi had closed.

“British Airways will consult with bmi staff and their unions as soon as possible.”

Seven daily slot pairs to be used between Heathrow and either Edinburgh and/or Aberdeen.

BA hag agreed to five up five daily slot pairs to be used between Heathrow and Nice, Cairo, Riyadh, Moscow, Edinburgh and/or Aberdeen.

Two Heathrow daily slot pairs will also be leased to Transaero for use on flights to Moscow.

Other airlines can apply for seats on the integrated BA/bmi short- and mid-haul network for their transfer passengers, on normal commercial terms, BA added in a statement.

EU competition commissioner Joaquin Almunia explained: “The commitments package includes an appropriate number of very sought-after slots at London Heathrow as well as far-reaching feeder arrangements as regards connecting passengers.

“We are therefore satisfied that the competitive dynamics will be maintained so as to ensure choice and quality of air services for passengers.”

As a result of the deal, IAG will increase its number of slots at Heathrow by 42 daily slot pairs, meaning BA will have over half of slots at the airport.