Virgin refuses to surrender BMI to IAG

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Virgin Atlantic is refusing to back down in the scrap for UK operator BMI, opting to appeal the European Commission's approval of rival International Airlines Group's acquisition of the struggling carrier.

IAG secured clearance in March to purchase BMI from Lufthansa Group.

While Virgin is to bid for 12 slots that British Airways will surrender as part of the remedial measures for competition clearance, president Richard Branson says the overall takeover will lead to BA's "total market dominance" at London Heathrow.

"The European Commission has seemingly ignored all of the strong cases made by politicians, business groups and airlines, to enable one big company to become even more bloated," he adds.

"Competition regulation should protect the customer from monopoly situations where companies can set whatever prices they like and stop investing in their product. In these situations, the public suffers, the industry suffers, and the country suffers."

The slot remedies are "completely inadequate", Virgin Atlantic claims. The carrier is demanding that more BMI slots be released.

Virgin Atlantic also believes these slots should not be split between several airlines, in order to strengthen competition against the enlarged BA.

"You cannot provide serious competition in a piecemeal way and we believe it is crucial to use the slots together to create some sort of critical mass with a strong message to the consumer," says Branson.

"This deal was agreed with lightning speed and we think the number of slots offered is derisory - representing less than a quarter of BMI's former network. The remedies should be there to replicate the competition that BMI represented."