BA remains interested in fate of BMI

Washington DC
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British Airways continues to monitor BMI as the carrier's new owner Lufthansa works on a restructuring plan while agreeing to supply a loan to BMI to fill a funding gap the carrier faces next year.

Recently BA chief executive Willie Walsh told analysts the carrier was keeping a close watch on developments at BMI, which was purchased earlier this year by Lufthansa.

Walsh says BA has made it known to Lufthansa it was interested in the fate of BMI, and has indicated BA's interest could run beyond just BMI's coveted slots at London Heathrow. He has said BMI serves route that could be of interest to BA in the future.

Speaking to ATI earlier this week at a ceremony to mark Mexicana's entry into the Oneworld Alliance BA director of strategy Robert Boyle reiterated that point, explaining BMI over the years has tried to open up routes not served by BA, and BMI faces competition on those routes largely from low cost carriers and trains.

Boyle also says BA has made its interest in BMI known Lufthansa, but clarifies no discussions have been held with any of the parties about BA taking any sort of stake in BMI. He stresses BMI's fate is ultimately in Lufthansa's hands.

BMI has filed accounts detailing its financial situation and its forecast shows it requires £190 million in additional funding by 31 October 2010. Parent Lufthansa has agreed to a £95 million secured loan to BMI.

Lufthansa is under no obligation to supply the additional funding, and if it opts not to give BMI further financial support, BMI says it would sell slots at London Heathrow.