BMI takeover 'fantastic' for passengers

The takeover of airline BMI could see a strengthening of British Airways but the weakening, or even possible disappearance, of low-fare carrier bmibaby.

Willie Walsh, the head of BA's parent company IAG, which is taking over BMI, said the deal was "fantastic" for passengers and the UK economy.

But IAG, which also runs Spanish carrier Iberia, is going to concentrate on BMI's long-haul routes out of Heathrow airport in west London.

Bmibaby, started in 2002 and which flies out of Belfast, Birmingham and East Midlands airports, is part of the deal.

But there is already talk of "restructuring" the low-fare carrier which could spell bad news for staff and customers.

Mick Rix, national officer of the GMB union, today expressed fears about the jobs' situation.

He said, "The announcement that IAG is in talks with BMI is not a shock but as yet we don't know the full details of these discussions.

"We have had talks with the chief executive of BMI in recent weeks and he has committed to sharing whatever outcomes of any proposed sale of further ownership of bmi with the unions.

"There are some concerns for our members such as skills, jobs and pensions. GMB, the TUC and relevant parties are working together to find out the full extent of what the future holds for BMI."

Mr Walsh said today: "This is a great story for IAG and also great for the UK economy and for consumers.

"We will expand our networks, particularly on long-haul which is so critically important to the UK economy. The deal will allow us to connect further to the emerging world economies."

Asked about jobs, Mr Walsh said: "It's far too early for us to say what the impact will be."

Sir Richard Branson's airline Virgin Atlantic, which said today that it still hoped to buy BMI, will oppose the IAG plan on the grounds that it will make BA too dominant at Heathrow.

But Mr Walsh said he was confident the IAG deal would go through.

BMI, formerly British Midland, has an extensive long-haul network, which includes Africa, Asia and North America.

Services include Amritsar in India as well as popular North American destinations such as New York, Los Angeles, San Francisco, Washington DC and Montreal.

BMI's regional services, which operate out of a number of UK airports, including Aberdeen, Edinburgh, Glasgow, Leeds Bradford, Manchester and East Midlands, are to be sold separately.

PA