Virgin attacks IAG's BMI bid

 
Kasmira Jefford
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VIRGIN Atlantic has lashed out at British Airways owner International Airline Group’s (IAG) bid to buy the loss-making BMI from Germany’s Lufthansa, warning that it still faces competition concerns before it can proceed.

Virgin responded to IAG’s announcement on Friday that it had “reached an agreement in principle” to buy BMI by confirming it had also made a bid for BMI and was still working with Lufthansa on the next stage of the process.

Chief executive Steve Ridgeway said yesterday that its rival IAG still had “a massive competition mountain to climb”, stressing that the deal was far from sealed.

BMI would be a significant coup for IAG as it holds nine per cent of the coveted take-off and landing slots at London Heathrow, Europe’s busiest airport, which is now operating at full capacity after plans to build a third runway were scrapped.

The deal – believed to be worth £300m – would increase BA’s share of Heathrow’s slots from 45 to 53 per cent. Meanwhile Virgin, BA’s main rival on long-haul transatlantic routes, only holds three per cent of Heathrow slots.

Ridgeway warned that British Airways’ hold of Heathrow airport was “already too dominant” and that the purchase of BMI “would be disastrous for consumer choice and competition”.

“With government limiting growth at London Heathrow, they cannot afford to turn a blind eye to the deterioration of competition that would result from a BA purchase of BMI,” Ridgeway said in a statement.