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Virgin Wants BMI As A Result Of Open Skies  
User currently offlineConcorde001 From United Kingdom, joined Jan 2005, 1230 posts, RR: 3
Posted (7 years 6 months 1 week 5 days 23 hours ago) and read 9738 times:

We all know Branson wants BD, but it is being reported that he wants the airline even more as a result of Open Skies. It makes sense - it might be hard to compete as it does (mainly O & D trafic) on US routes when CO and DL arrive.

Virgin Atlantic Airways, the U.K. carrier controlled by billionaire Richard Branson, is still interested in acquiring BMI after an ''open-skies'' agreement with the U.S. was approved by the Europe Union yesterday.

''We've always said that we remain interested in acquiring BMI,'' Paul Charles, a spokesman for London-based Virgin Atlantic, said in an interview today. ''In the light of open skies, in a few years time there may be more consolidation...''

...BMI ''still makes sense as a strategic fit,'' said Charles. ''We're only a long-haul carrier and it may make sense for us to expand by being a short-haul carrier as well.''

Combining Virgin Atlantic's long-haul network with BMI's short-haul flights would also boost the number of transfer passengers carried and add slots at Heathrow for Virgin, he said.

An offer from Virgin Atlantic ''is something we're not interested in,'' Jo Tabberer, a spokeswoman for BMI, in an interview today. ''It's certainly not something on our radar. There are no talks going on.''

The move to open Heathrow to other airlines may increase the value of takeoff and landing slots at the airport, where BMI owns about 13 percent of the spaces, second only to British Airways' 41 percent.


Source: Bloomberg

Reuters has published Sir Michael Bishop's response to speculation about VS bidding for BD:

Bmi Chairman Michael Bishop was quoted in the Telegraph on Friday as denying his firm was a bid target.

"I've no plans to change the shareholders. People always go on fishing trips but it's business as usual here," the newspaper quoted him as saying.

The bmi spokeswoman added that bmi's position -- that it was not interested in a takeover bid -- remained unchanged


Source: BMI.XML" target="_blank">Reuters

I hope they hurry up and merge! It is interesing to hear SMB say ownerhsip of BD will not change ...when does LH's contractual obligation to buy SMB's shares expire?

52 replies: All unread, showing first 25:
 
User currently offlineSteeler83 From United States of America, joined Feb 2006, 9215 posts, RR: 21
Reply 1, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9708 times:

I guess such a move would put an end to all this talk about which US cities BMI will expand to from LHR. Would that mean that VS would then join the Star Alliance, or would that leave a void in the alliance?


Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
User currently offlineKevin777 From Denmark, joined Sep 2006, 1165 posts, RR: 1
Reply 2, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9581 times:

Quoting Concorde001 (Thread starter):
Combining Virgin Atlantic's long-haul network with BMI's short-haul flights would also boost the number of transfer passengers carried and add slots at Heathrow for Virgin, he said.

Indeed, the latter. Right now, many BD slots are used for stuff not "worthy" of LHR, for instance lower-yield short hauls in the U.K., or intra-European transfers via LHR

Quoting Concorde001 (Thread starter):
I hope they hurry up and merge! It is interesing to hear SMB say ownerhsip of BD will not change ...when does LH's contractual obligation to buy SMB's shares expire?

I think SK's obligation expires pretty soon, I'd imagine the same goes for LH... with open skies though, BD suddenly became worth much more for these two.. probably, the airline is not as hated by LH and SK now...!

Quoting Steeler83 (Reply 1):
I guess such a move would put an end to all this talk about which US cities BMI will expand to from LHR. Would that mean that VS would then join the Star Alliance, or would that leave a void in the alliance?

Agree. I think the best option would be to focus the strengths in a single long-haul UK carrier to the US (in addition to BA) rather than two separate. Also, VS has a much, much better long-haul brand than BD. As for VS in Star? Well, I still think they could be better off alone, but yes, Star is likely closer now..

Either way, go get'em, VS!

Kevin777  Smile



"I was waiting for you at DFW, but you must have been in LUV" CPH-HAM-CPH CR9
User currently offlineSteeler83 From United States of America, joined Feb 2006, 9215 posts, RR: 21
Reply 3, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9488 times:

Quoting Kevin777 (Reply 2):
Agree. I think the best option would be to focus the strengths in a single long-haul UK carrier to the US (in addition to BA) rather than two separate. Also, VS has a much, much better long-haul brand than BD. As for VS in Star? Well, I still think they could be better off alone, but yes, Star is likely closer now..

I don't want to seem single or narrow-minded or anything, but PIT is dying to get transatlantic service back, and since US will not bring it back, it seems that an international airline would hold the only possibility. With BMI already in Star, I figure that they'd be the most likely airline to start service to PIT from Europe. LH said no. I don't think Swiss, SAS, TAP, or Austrian would agree to this either; they'd all say the same thing LH did, "No, it's not feasible."

PIT's international demand is growing, I am sure that by next summer, there will be sufficient demand for at least Summer service to Europe. Bayer is actually making a much larger presence in Western PA, as is Westinghouse/Toshiba. UPMC is expanding overseas as well. Currently, 300 daily passengers depart PIT for Europe, and I only see this figure increasing over time. Plus, some regional flights lost when the hub closed are coming back. Morgantown, Parkersburg, etc... they're returning after poor performance with Regions Air service to CLE. Colgan will be bringing back the service with "larger" Saab340s. When those flights were originally flown to PIT, US used Beech1900s, so IMO, a Saab is somewhat of an upgrade.

I think if VS were to take over and fly LHR-US routes, they'd only focus on O&D cities, and PIT does not have the O&D, so VS will not be coming to PIT if that's the case... What I stated above would hopefully look attractive to an airline in the even that they hopefully look into launching service. They would still need connecting traffic to fill the plane. I am just saying that the return of transatlantic service to PIT would be a huge economic shot in the arm. I think it would help if the international airline was a member of the Star Alliance so that a codeshare between US and this airline could go through. US would provide the connecting traffic for the international airline's flight to LHR. Unless US could propose a codeshare with VS though, but is that likely?

[Edited 2007-03-23 15:01:35]


Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
User currently offlineUAL777UK From United Kingdom, joined Nov 2005, 3356 posts, RR: 1
Reply 4, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9465 times:

Quoting Kevin777 (Reply 2):
probably, the airline is not as hated by LH and SK now...!

Exactly, and I think for that reason alone BMI will stay independant or maybe LH will buy into it more?


User currently offlineKevin777 From Denmark, joined Sep 2006, 1165 posts, RR: 1
Reply 5, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9444 times:

Quoting Steeler83 (Reply 3):
Unless US could propose a codeshare with VS though, but is that likely?

I think it could be - after all, VS code-shares with who ever they find right. CO, SQ, EK.. don't they already codeshare with US in the U.S:? They had one with HP back then.

Star or not, VS could codeshare with US I reckon..

Kevin777



"I was waiting for you at DFW, but you must have been in LUV" CPH-HAM-CPH CR9
User currently offlineSteeler83 From United States of America, joined Feb 2006, 9215 posts, RR: 21
Reply 6, posted (7 years 6 months 1 week 5 days 22 hours ago) and read 9363 times:

Quoting Kevin777 (Reply 5):
I think it could be - after all, VS code-shares with who ever they find right. CO, SQ, EK.. don't they already codeshare with US in the U.S:? They had one with HP back then.

Star or not, VS could codeshare with US I reckon..

Then all we can do is  pray  for this to happen  crossfingers 



Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
User currently offlineFlyorski From United States of America, joined Dec 2004, 987 posts, RR: 1
Reply 7, posted (7 years 6 months 1 week 5 days 21 hours ago) and read 9307 times:

Quoting UAL777UK (Reply 4):
BMI will stay independant or maybe LH will buy into it more

I would not be surprised to see LH purchase BMI......



"None are more hopelessly enslaved, than those who falsly believe they are free" -Goethe
User currently offlineBmiexpat From United Kingdom, joined Sep 2005, 175 posts, RR: 0
Reply 8, posted (7 years 6 months 1 week 5 days 21 hours ago) and read 9175 times:

Quoting Kevin777 (Reply 2):
Right now, many BD slots are used for stuff not "worthy" of LHR, for instance lower-yield short hauls in the U.K.,

bmi provides very effective competition to BA on EDI, GLA, ABZ and MAN, and is the only carrier serving LHR from LBA, MME, INV and BFS. Without bmi serving these domestic stations, then quite a lot of the UK would be either without a connection to LHR, or face the old style monopoly fo BA with high fares and poor service!


User currently offline7LBAC111 From United Kingdom, joined Jul 2004, 2566 posts, RR: 35
Reply 9, posted (7 years 6 months 1 week 5 days 20 hours ago) and read 8994 times:

Quoting Kevin777 (Reply 2):
BD suddenly became worth much more

And with the acquisition of BMED, and their slots, they may have been very shrewd, for the first time in living memory, in increasing the value of themselves.

7L



Debate is what you put on de hook when you want to catch de fish.
User currently offlineJfk777 From United States of America, joined Aug 2006, 8386 posts, RR: 7
Reply 10, posted (7 years 6 months 1 week 5 days 13 hours ago) and read 8505 times:
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BMI's turn to cash in has finally arrived, SAS & Lufthansa have been a long anxious shareholder to sell. Given Sir Michael Bishop's age, he may say it time to head to the British Highlands with his shot guns and labradors. Other then BA, BMI has the largest stash of LHR slots, these are worth their wieght in Platnuim, the slots may the only valuable part of the airline group.

User currently offlineBrianDromey From Ireland, joined Dec 2006, 3920 posts, RR: 9
Reply 11, posted (7 years 6 months 1 week 5 days 12 hours ago) and read 8166 times:

Quoting Kevin777 (Reply 2):
Indeed, the latter. Right now, many BD slots are used for stuff not "worthy" of LHR, for instance lower-yield short hauls in the U.K., or intra-European transfers via LHR

There are lost of airports around the UK which depend on bmi to get them to LHR. As it stands BA, VS, EY, QR and any *A carrier serving LHR use bmi to get into the regions. I agree that there are many routes which bmi may wish to cut if it were to become part of VS or another carrier, but the routes to the regions would not be top of the list. Destinations like PMI, NCE, etc would be more likely to see the chop.

Quoting Jfk777 (Reply 10):
the slots may the only valuable part of the airline group.

I respectfully disagree. bmi have a great(if slightly confusing) brand. They have tarnished it slightly, but are working to improve things. The new medium haul seems promising as does the new service concept. They also have a very strong regional operation and a damn good LCC. IF bmi could get its resources together and assign the right equipment and service levels to each route they could do exceptionally well.

I always enjoy my bmi/bmibaby flights. The crews and the service are great, and the fares are pretty good as well. So I'm happy.
Brian.



Next flights: MAN-ORK-LHR(EI)-MAN(BD); MAN-LHR(BD)-ORK (EI); DUB-ZRH-LAX (LX) LAX-YYZ (AC) YYZ-YHZ-LHR(AC)-DUB(BD)
User currently offlineMetalInyoni From South Africa, joined Oct 2005, 267 posts, RR: 0
Reply 12, posted (7 years 6 months 1 week 5 days 11 hours ago) and read 7857 times:

Generally people seem to think VS will aquire BMI, but how unlikely is it that the reverse scenario happens - BMI buying Virgin? Its a genuine question as I have no real idea of the economice of a take over bid either way.


Money doesn't make you happy but I would rather cry in a BMW than on public transport.
User currently offlineSteeler83 From United States of America, joined Feb 2006, 9215 posts, RR: 21
Reply 13, posted (7 years 6 months 1 week 5 days 10 hours ago) and read 7343 times:

Quoting MetalInyoni (Reply 12):
Generally people seem to think VS will aquire BMI, but how unlikely is it that the reverse scenario happens - BMI buying Virgin? Its a genuine question as I have no real idea of the economice of a take over bid either way.

Hmmm... I never thought of that, but again the question... Can BMI afford a buyout of a larger, a MUCH larger airline. Granted we've seen this occur already, with HP buying US to become the 5th largest airline in the US, and US made an offer to buy DL (which would have been an abomination of the airline industry if that would have happened IMO.) That would be interesting, and I am sure that the Virgin name would stay and everything. Ya know, maybe a marriage of BMI and VS wouldn't be so bad...



Do not bring stranger girt into your room. The stranger girt is dangerous, it will hurt your life.
User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5462 posts, RR: 7
Reply 14, posted (7 years 6 months 1 week 5 days 9 hours ago) and read 7260 times:

Quoting Jfk777 (Reply 10):
BMI has the largest stash of LHR slots, these are worth their wieght in Platnuim, the slots may the only valuable part of the airline group.

Some of them are - say, the first 30 or so dep/arr pairs. After the new US carriers get a reasonable presence established and the initial frantic demand is satisfied, the slot value will revert to whatever it was worth last week.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineAirNZ From , joined Dec 1969, posts, RR:
Reply 15, posted (7 years 6 months 1 week 5 days 8 hours ago) and read 7022 times:

Quoting Kevin777 (Reply 2):
Indeed, the latter. Right now, many BD slots are used for stuff not "worthy" of LHR, for instance lower-yield short hauls in the U.K., or intra-European transfers via LHR

Sorry, don't quite get you there. Why are flights within the UK not 'worthy of LHR"??????


User currently offlineBn727 From United States of America, joined Sep 2006, 83 posts, RR: 0
Reply 16, posted (7 years 6 months 1 week 5 days 6 hours ago) and read 6716 times:

Just settle down everybody. Open skies are not open yet. If they do open then I hope Southwest and Jetblue go to UK and fly in the face of Euro carriers...Keep the playing field even though. Equal airport landing and airport operating fees should apply to all.

User currently offlineVonRichtofen From Canada, joined Nov 2000, 4627 posts, RR: 36
Reply 17, posted (7 years 6 months 1 week 5 days 6 hours ago) and read 6688 times:

I'm curious as to what other STAR carriers would think of VS acquiring BD, particularly the STAR carriers with a large presence at LHR, namely AC and UA?


Kris



Word
User currently offlineLuketenley From United States of America, joined Jul 2006, 419 posts, RR: 1
Reply 18, posted (7 years 6 months 1 week 5 days 6 hours ago) and read 6612 times:

When I talked to a buddy of mine that works for the ACAA, we both agreed on that US won't be the airline to bring back international service to PIT, but from an independent carrier like BMI. I could even see some international flights being chartered rather then scheduled. Could be another option. I do see international flights of some sort coming within the next few years. Traffic is growing at PIT.


Pittsburgh International Airport lover
User currently offlineQXatFAT From Israel, joined Feb 2006, 2405 posts, RR: 5
Reply 19, posted (7 years 6 months 1 week 5 days 4 hours ago) and read 6324 times:

Quoting Kevin777 (Reply 5):
I think it could be - after all, VS code-shares with who ever they find right. CO, SQ, EK.. don't they already codeshare with US in the U.S:? They had one with HP back then.

Yes VS used to code-share with HP but that has now been terminated IIRC. With the new US, a few of the code-shares were dropped with VS and Eva. It would be nice for VS to code-share with US until it gets Virgin America up and going on a good size scale. Plus, with a code-share with VS, they can get people to Africa and Asia.



Don't Tread On Me!
User currently offlineScotron11 From United Kingdom, joined Feb 2004, 1178 posts, RR: 3
Reply 20, posted (7 years 6 months 1 week 5 days 3 hours ago) and read 6191 times:

Does VS have the money to purchase BD?? Based on LHR slots alone, BD's valuation could be from £500M-2.2B ($900M-$4.2B). Also, VS is 49% owned by SQ, so where would that kind of money come from?

Because VS is a private company, it's hard to know what kind of profits it generates from their flight operations. Additionally, if VS did takeover BD, it would do nothing to change their severe widebody shortage right now. And I don't see them taking delivery of the 15-20 widebodies needed to launch service to 10 US destinations in a years time.


User currently offlineThePRGuy From , joined Dec 1969, posts, RR:
Reply 21, posted (7 years 6 months 1 week 5 days 1 hour ago) and read 5842 times:

Well this ain't happening
Sir Mick will do his usual stubborn "I'd rather stay in this big house and lose loads of money!!!"
Shame, Virgin Europe (rebrand of bmi) could work, don't know if the Virgin America business model would apply - all airbus though (bar EMB)!!

Actually think about it:
Virgin Blue (Australasia/longhaul to US)
Virgin Nigeria (Africa)
Virgin America (US/Canada shorthaul)
Virgin Atlantic (Longhaul to most areas)
Virgin Express (SN Brussels) (EU)

Add bmi to the portfolio and Sir Dick has a rather large airline empire going on....
Thanks
Alex


User currently offlineLite From , joined Dec 1969, posts, RR:
Reply 22, posted (7 years 6 months 1 week 4 days 23 hours ago) and read 5391 times:

I'd imagine that Lufthansa might be eyeing up at least SAS' share in bmi, the latter company has been in financial difficulties in the past and could make a small fortune from selling their shares to the former company who would want to cash in on the potential cash cow of trans Atlantic flights from LHR, whilst using a respected and well-known(ish) brand like bmi for the services. Lufthansa could invest in the fleet, product and branding - a return to British Midland would certainly do them a lot of good to establish themselves as British and returning to a popular name rather than the moniker they use now - and the new airline would be serving trunk domestic (and DUB) routes, an expansive medium haul network to Central Asia and Africa, and potentially a trans-Atlantic route network. Plenty of potential to turn a basket case airline into a nice money maker. I would hate to see bmi gobbled up into Virgin, they would undoubtedly slash BD presence in the regions.

User currently offlineJGPH1A From , joined Dec 1969, posts, RR:
Reply 23, posted (7 years 6 months 1 week 4 days 23 hours ago) and read 5304 times:

Quoting ThePRGuy (Reply 21):
Actually think about it:
Virgin Blue (Australasia/longhaul to US)
Virgin Nigeria (Africa)
Virgin America (US/Canada shorthaul)
Virgin Atlantic (Longhaul to most areas)
Virgin Express (SN Brussels) (EU)

Except that Virgin Blue isn't owned by SRB any more, and Virgin Express is being incorporated into Brussels Airlines.


User currently offlineClassicLover From Ireland, joined Mar 2004, 4636 posts, RR: 23
Reply 24, posted (7 years 6 months 1 week 4 days 23 hours ago) and read 5257 times:

Quoting JGPH1A (Reply 23):
Except that Virgin Blue isn't owned by SRB any more,

Not wholly, he still has 20% or thereabouts.



I do quite enjoy a spot of flying - more so when it's not in Economy!
25 Post contains images Kevin777 : OK, guess I didn't make myself clear here, sorry! What I meant was that a lot of BD capacity at LHR is used for stuff not worthy of LHR; in the sense
26 Post contains images Steeler83 : Yeah, hopefully the annual pax numbers won't be under 10 million for long! I just think that it would be more likely that this airline be part of the
27 Lite : Personally, I would not like to see bmi swallowed up by Virgin, bmi are my local airline and think with the exception of some "interesting" business m
28 Steeler83 : I can see your point, and I myself am not entirely for the VS takeover of BMI. I said above that it would likely mean that Star loses a member. Then,
29 Lite : VS would probably want to keep the A321 fleet to fly into the lucrative middle east market, where they already fly to Dubai, and would probably keep t
30 MasseyBrown : I guess somebody at ACAA should know best, but I wouldn't give up on US completely. Parker and Co. seem very pragmatic and if a PIT - Europe flight w
31 UAL777UK : I think that they would not be happy at all, it would no doubt signal the end of any connection to the Star Alliance, UA would lose a lot of feed. I
32 Glareskin : I thought UA was voluntarily reducing it's presence at LHR. Didn't they recently sell some slots to DL? If so they probably won't mind LH buying BD.
33 UAL777UK : They didn't sell the slot, they sold the route authority to DL, a very big difference. UA, still has a couple of leased slots floating about with AC
34 Lite : I wasn't aware that Lufthansa had a problem with Virgin joining Star Alliance, but knew that Bishop has always had a problem with selling his beloved
35 David_itl : Branson's already stated that any takeover of bmi would result in LHR-MAN being canned (now there's a few slots to be used for extra transatlantic fo
36 Lite : I wasn't aware that SRB had already made any statements about the future of a merged bmi and virgin atlantic, but interesting reading. I know his pers
37 Post contains links David_itl : See this link. I can imagine both to be allowed to continue to operate but under their own steam (or rather, jet propulsion!)
38 Lite : Thanks for the link. Personally if Virgin bought bmi, I'd imagine that bmibaby and bmi regional would be merged and operated like virgin blue. Low-cos
39 Luketenley : 200 flights per day would be about right. I have thought about this before. Would be a good size for PIT. As far as international, I would love to se
40 AirNZ : Thanks for the clarification but, unfortunately, I still don't quite fully follow your train of thought and particularly with reference to your point
41 Steeler83 : I think that as well, and it is good to see some regional feed returning, especially MGW and PKB thanks to Colgan Air. As I said before, US used to h
42 Luketenley : I am seeing quite a few E70's and E75's now. Republic was supposed to have a crew base in PIT as far as I know. I would think they would have more fl
43 Steeler83 : Oh yeah, naturally. I was just saying that what Colgan Air is starting is already a little larger than what US had in the days of the hub. It's still
44 Kiwiandrew : nobody is 'entitled' to anything - if the flights make economic sense for a business to operate they should continue , if they don't make economic se
45 Kaddyuk : I fly from GLA to LHR because i WANT to fly to LHR... If i was forced to travel to Luton i'd take the train and avoid flying. You cant do that. The s
46 Lite : I wasn't aware that such a system was in place, rather that the slots were to be used for an airline rather than a route. When bmi gets to launch tra
47 Bobnwa : In the US, cities such as SEA, LAX, SFO, PDX to not have flights to DCA which is the domestic airport in Washington the capitol, nor to LGA which is
48 Post contains links David_itl : From the Observer "BMI chief executive Nigel Turner said he expected to switch domestic routes to the US when the 'open skies' deal comes into effect
49 Steeler83 : Do they still intend of going into the lion's den, otherwise known as JFK or ORD? If they think they can pull off LHR-ORD or JFK, all the power to th
50 Post contains images Kevin777 : My words exactly, thanks, Kiwiandrew!.. Well, I'll give you that I'm no big fan of LHR either; it's an absolute crap airport IMO (getting better thou
51 Steeler83 : Let me add that my Geography professor from my alma mater Millersville University of PA flies his London class to LHR out of PHL via BA. He prefers BA
52 Lite : If it was any company besides virgin, then I'd say bmi would go out of their way to purchase the smaller airline, VS have 3% of LHR slots, but are th
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