BMI buyout 'will lead to monopoly'
The owners of British Airways have announced a deal to buy ailing airline BMI for £172.5 million amid fears that jobs will be lost following the acquisition.
There are concerns that the takeover will unfairly strengthen BA's position at Heathrow airport, with Sir Richard Branson announcing that his rival airline, Virgin Atlantic, would "fight this monopoly every step of the way".
Under the binding agreement, BA's owners, International Airline Group (IAG) will acquire loss-making BMI, formerly British Midland Airways, from German carrier Lufthansa.
This will give IAG, which also owns Spanish airline Iberia, up to 56 additional, and much prized, take-off and landing slots at Heathrow.
IAG chief executive Willie Walsh warned that there would be "some job losses" as a result of the deal, although he added that it was too early to say just how many posts would go.
However he said there could, eventually, be more jobs from the deal if available short-haul slots were later used for long-haul services which would mean "more pilots, more cabin crew and more engineers".
Mr Walsh also dismissed talk of BA "over-dominance" at Heathrow, saying that the BMI acquisition would actually "enhance competition".
The deal will see IAG own more than half of the slots at Heathrow - 53% - once completed, which compares with Lufthansa's 66% hold at Frankfurt airport and Air France/KLM's 59% grip at Paris's Charles De Gaulle airport.
Mr Walsh said: "Using the slot portfolio more efficiently provides the option to launch new long-haul routes to key trading nations while supporting our broad domestic and short-haul network."
A spokesman for the Unite union said: "We will be looking to meet with IAG in the immediate future to press for guarantees on jobs and terms."