Etihad Airways has reportedly held talks with Virgin Atlantic on a potential partnership should the British airline bid for British Midland International (bmi), the loss-making unit of the German carrier, Lufthansa.
State-backed Etihad would be unable to make a bid of its own due to foreign ownership rules. But a possible tie-up between Etihad and Virgin would enable the Abu Dhabi carrier to tap into bmi’s short and medium long-haul network, sources told The Financial Times.
In an emailed statement to Arabian Business, Etihad didn't rule out its interest, but said "we never comment on speculation of this nature, except to say that we talk regularly and frequently to many airlines and a range of other businesses from all over the worldabout issues and opportunities."
Virgin Atlantic and IAG, the holding company of British Airways and Spain’s Iberia, have said they are interested in buying the carrier. Virgin’s billionaire owner Richard Branson has been interested in purchasing BMI for more than a decade.
Bmi generated a €120 million ($166.5 million) operating loss in the first six months of 2011. The carrier’s biggest assets are its slots at London Heathrow airport, where it controls around 10% of take-off and landing rights. Citigroup analyst Andrew Light last month estimated these to be worth around €460 million ($630 million).
Virgin Atlantic said Saturday it was concerned about the possibility of BMI carrier falling into the hands of IAG.
“We are ... very concerned about the competition ramifications of an IAG purchase of BMI, due to BA's dominant position at London Heathrow, the world's busiest international hub, which is completely full,” the airline told The Independent newspaper.
Dubai state carrier Emirates Airline was among the carriers said to have expressed initial interest in buying bmi, but said in September it had no plans to acquire any airlines.