aireuropeuk733
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Bcal And 3i

Thu Jun 16, 2005 9:45 pm

I am reading a book at the moment (It was nice to fly with friends - A history of Air Europe) and in the chapter regarding the possible merger with BCAL it mentions that at the time BCAL was majority owned by 3i. My question is...

How did this come about? I thought BCAL was created by a merger with BUA and Caledonian? Did the venture capitalists get involved due to an MBO?

Any info would be much appreciated. I'm sure someone like BCAL could fill me in .

Thanks

AE733
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jmc757
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RE: Bcal And 3i

Fri Jun 17, 2005 3:21 am

3i have been involved in many airlines in the past. They have tended to buy large chunks of airlines, sit on them for a bit and then sell them on. I believe they were the poeple who sold BCAL to BA, Citiexpress to BA, Excalibur to Globespan and Go to BA. Not sure exactly when they got involved with BCal, I would imagine it was way after the BUA/Caledonian merger, much nearer to the time they became part of BA.

Apparently they have entered talks recently to buy flyBe...

[Edited 2005-06-16 20:22:32]
 
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FlyCaledonian
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RE: Bcal And 3i

Fri Jun 17, 2005 6:13 am

3i didn't sell Go to BA, rather they invested in it when BA disposed of it and then sold Go to easyJet.
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jetjack74
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RE: Bcal And 3i

Fri Jun 17, 2005 6:21 am

The BUA/BCAL was implemented to mirror the BOAC/BEA merger to combine the operations of the international carrier with the Inter-European carrier to make it more streamlined. BUA did have some international services to the Mid-East, North Africa and long hau charters leading up to the merger with their 1101 Standard VC10's. I believe it happened between 1971-75. It operated as BUA/Caledonian until it was finally renamed British Caledonian in 1976. BCAL was sold to BA in 1986 with the merger effective in August of 1987.

[Edited 2005-06-16 23:24:22]
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BCAL
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RE: Bcal And 3i

Fri Jun 17, 2005 6:22 pm

Quoting AirEuropeUK733 (Thread starter):
How did this come about? I thought BCAL was created by a merger with BUA and Caledonian? Did the venture capitalists get involved due to an MBO?

Any info would be much appreciated. I'm sure someone like BCAL could fill me in .

Thanks

Sorry, I have been off line and just caught up with this post.

It is difficult to pin point exactly when 3i acquired its majority shareholding in BCal, but it was the majority shareholder at the time BCal was sold to BA.

British Caledonian was, as you assumed, formed by the merger of Caledonian Airways (Caledonian) and British United Airways (BUA).

Caledonian was formed in 1961 and was a Scottish based international airline with a fleet of DC7s. Fleet modernisation followed with Britannias being introduced, BAC1-11s, and B707s so by the late 1960s Caledonian was fully in the jet age. At that time, its main competitor, BUA, was in financial trouble and looking for a buyer. BUA hoped that they would be brought by BOAC, as BUA was only one of the two serious competitors to the BOAC-BEA monopoly. The other competitor was Caledonian who, to avoid BOAC-BEA having a larger monopoly, successfully bid for BUA. In November 1970, Caledonian brought and merged with BUA and for two years the airline was called Caledonian/BUA. Caledonian raised finance for the purchase through its existing shareholders and on the markets. It is probably at this time that 3i got their fingers in the pie. Another principal shareholder at the time was the British and Commonwealth Shipping Group.

In 1972, Caledonian/BUA was renamed British Caledonian Airways or BCal in abbreviated form. In 1975, BOAC and BEA merged to become British Airways. British Caledonian was then under intense monopolistic pressure as whereas BA received government assistance and had a monopoly at LHR, BCal had to rely on its investors and was restricted to operations at LGW. BCal never received any state assistance, raising all its finance from operations and investors.

For many years, BCal was the sole UK operator on flights between the UK and South America (inherited from BUA who took over the loss-making route from BOAC/BSAA and turned it into a profitable route). They also started international services from LGW to Houston, DFW, and Atlanta. Following a review of the UK passenger aviation scene, BCal was designated the second UK carrier. BCal was also forced to swoop over their South American routes to BA in exchange for BA's routes to the Gulf. Shortly thereafter, the oil and Gulf crisis started, seriously affecting BCal's business on the Gulf routes causing the airline to report losses, which was not good news for investors. This, coupled with the airline being denied access to LHR, led to Sir Adam Thompson (BCal Chairman) being forced by investors to sell the airline to BA for a figure (I believe) of £264m.
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cornish
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RE: Bcal And 3i

Fri Jun 17, 2005 6:47 pm

Quoting BCAL (Reply 4):
For many years, BCal was the sole UK operator on flights between the UK and South America (inherited from BUA who took over the loss-making route from BOAC/BSAA and turned it into a profitable route). They also started international services from LGW to Houston, DFW, and Atlanta. Following a review of the UK passenger aviation scene, BCal was designated the second UK carrier.

Didn't they also have quite a network of routes to Southern Africa too? When I was young kid, my grandparents and various other family members were still living in Zambia, Rhodesia (as Zimbabwe then was) and the like. Although I was very small at the time, I thought they used to take BCAL flights to and from the UK (the grandparents aren't alive any more to ask) -was Lusaka one of the cities served ?
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
BCAL
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RE: Bcal And 3i

Fri Jun 17, 2005 6:54 pm

Quoting Cornish (Reply 5):
Didn't they also have quite a network of routes to Southern Africa too?

I believe that BUA did serve a network of routes to Southern Africa, but cannot immediately recall if BCal continued the services. Will check and reply soon, unless someone beats me to it.
MOL on SRB's latest attack at BA: "It's like a little Chihuahua barking at a dying Labrador. Nobody cares."
 
cornish
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RE: Bcal And 3i

Fri Jun 17, 2005 7:08 pm

A quick search and it seems I was indeed right.....

http://www.airchive.com/Timetables%2...%20Maps/UK%20&%20Ireland/BCALmap81
Just when I thought I could see light at the end of the tunnel, it was some B*****d with a torch bringing me more work
 
jmc757
Posts: 1206
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RE: Bcal And 3i

Sat Jun 18, 2005 3:05 am

Quoting FlyCaledonian (Reply 2):
3i didn't sell Go to BA, rather they invested in it when BA disposed of it and then sold Go to easyJet

Ooops thats what i meant!

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