[Telegraph] The future of bmibaby and bmi Regional is in doubt after International Airlines Group completed the takeover of parent company bmi but admitted it does not want the company’s low-cost and domestic businesses.
IAG, the owner of British Airways, said on Friday that bmibaby and bmi Regional “will not be integrated” into the company and it “will pursue options to exit these businesses”.
Trade union Unite warned 800 jobs are at risk and urged IAG to seek a “viable buyer” for the businesses.
“BA must do everything possible to give these two businesses and the workforce a long-term future in the UK aviation industry,” said Oliver Richardson, Unite national officer.
IAG has already warned that 1,200 jobs will be lost of part of the integration of bmi mainline, the long-haul division, into BA.
The company agreed a £172.5m deal with Lufthansa for bmi, but this included a sizeable discount in the event the German airline could not sell bmibaby and bmi Regional before the takeover was completed. Analysts believe the discount, which will be finalised in June, could be as much as £80m. IAG said the price reduction will offset the costs of operating and then exiting bmibaby and bmi Regional.
German company Intro Aviation and Dublin-based charter carrier ACL were linked with a bid for bmibaby, but a deal could not be struck.
Loss-making bmi is made up of three divisions – a traditional airline serving Europe, the Middle East and African, bmi regional, serving the UK, and low-cost unit bmibaby.
By Graham Ruddick
9:30PM BST 20 Apr 2012