could make a decision on the sale of British Midland “in the coming weeks,” possibly before the end of this year, CEO Christoph Franz told reporters on the sidelines of the Chief Executive Board (CEB) meeting in Addis Ababa, Ethiopia.
He made the comments after it emerged earlier this week thatalso had made a bid for the airline. International Airlines Group (IAG) and Lufthansa said in early November that they had reached an agreement in principle over the sale of BMI to IAG.
However, industry sources say that since then, progress has been slow and Virgin Atlantic came up with a counteroffer in late November. Virgin wants to combine with BMI to form a hub-and spoke network. Franz said it would be “attractive” for Star Alliance to have such abased member. “That was also the original idea for us behind buying BMI,” Franz says.
Observers have long argued that from a strategy point of view selling BMI to Virgin Atlantic would make more sense for Lufthansa because rival BA would not be strengthened through access to BMI’s Heathrow slot portfolio.
However, Virgin Atlantic is itself looking for new investors and is mulling joining an alliance. The two moves combined could lead a merged Virgin/BMI to becoming a Star Alliance member. That, however, depends on cooperation of its 49% shareholder, which has said some time ago that it would like to exit as a Virgin Atlantic owner.