Sir Richard Branson’s Virgin Atlantic has held takeover talks with UK airline BMI British Midland, it emerged today.
A Virgin Atlantic spokeswoman confirmed the airline had been discussing a range of “co-operation” issues with BMI, including the possibility of a tie-up.
She said nothing had yet stemmed from the talks, which also covered sharing of facilities, code sharing and joint lobbying on matters of common interest.
A statement added: “There have been no definitive conclusions reached on the potential commercial opportunities, nor any other form of more permanent tie-up between the two companies, such as the acquisition of BMI by Virgin.”
BMI British Midland is controlled by founder and chairman Sir Michael Bishop, with Lufthansa and Scandinavian airline SAS holding the remaining 49% stake.
It is thought Virgin is keen to get hold of BMI’s short-haul routes into Heathrow, which would then act as a feeder into its long-haul empire.
Virgin added today: “BMI and Virgin have for some time been exploring possible areas for greater co-operation in expanding their respective businesses, including code sharing expansion, potential sharing of facilities and joint lobbying on matters of common interest.
BMI, which operates a fleet of 41 aircraft and employs almost 5,000 people, made a loss of £19.6m (€27.3m) last year after profits of £12.4m (€17.3m) in 2001.
It is a member of the Star Alliance code sharing agreement involving 15 other airlines and which is effectively a competitor to Virgin. United Airlines and Lufthansa are among the other Star members.