British Airways’ parent company International Airlines Group (IAG) has secured a deal with Lufthansa over the sale of struggling carrier BMI. The price is reported to be £172.5 million.

The deal will see IAG increase its take-off and landing capacity at Heathrow rise by 56 pairs, giving it 53 per cent share of the airport’s slots.

BMI recorded a pre-tax loss of over £150 million in 2010. The deal between Lufthansa and IAG will be finalised in the first quarter of 2012, after clearance by the European Commission.

BMI, which has its base in Castle Donington, Leicestershire, currently employs more than 3,600 people, and some job losses are expected as a result of the deal.

“Given the scale of BMI’s losses, there is an urgent need to restructure the business. Unfortunately, this will mean some job losses but we will secure a significant number of high quality jobs here in the UK and create similar new jobs in the future,” said Willie Walsh, IAG’s chief executive.

“IAG’s purchase of BMI will protect more British jobs than if the airline had been closed and had its Heathrow slots sold off. There will be restructuring costs spread over three years, but these will be significantly lower in total than BMI’s current annual losses.”

Lufthansa’s other carriers, BMI Regional and Bmibaby, are not included in the deal and can be sold by Lufthansa before the deal is finalised.

Mr Walsh added: “BMI Regional and Bmibaby are not part of our plans and Lufthansa has the option to sell them before completion.”

The news will be a blow for Virgin Atlantic, which recently put in an offer of a reported £50 million for BMI.

(Image: happyrelm)

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