Lufthansa, the German flag-carrier, wrote off more than £140m of investment in British Midland International (BMI) in the 18 months after it took control of the airline in June 2009.
The losses, revealed in documents placed with Companies House last week, show why Lufthansa is now so keen to sell up. It emerged on Friday that British Airways' (BA) parent International Airlines Group (IAG) is in very early talks with Lufthansa over buying out either the whole or part of BMI.
The latest annual results filing by LHBD Holding, the Lufthansa subsidiary that owns BMI, shows that it put £45m into the British airline in 2010.
The accounts stated: "The directors have assessed the recoverability of the investment in BMI and concluded, based on projected cash flows, that the investment should be fully impaired. This has resulted in an exceptional charge of £45m."
In the second half of 2009, LHBD poured £95m into the airline which the directors also believed could not be recovered.
IAG chief executive Willie Walsh is known to be particularly keen on snapping up BMI's slots at Heathrow, where it is the second-biggest airline behind BA. These are estimated to be worth around €460m (£404m)and could fetch bids from rival operators, including Virgin Atlantic.
A source close to the sale process said: "It's fair to say that the BMI deal hasn't worked out too well for Lufthansa."