Bmi may be snapped up in takeover

Midland-based airline bmi could be taken over by a Middle Eastern operator, according to reports today.

Etihad, the national carrier of the United Arab Emirates, is believed to have held initial discussions.

Bmi as well as the airline’s major stakeholder Lufthansa have been involved.

Backed by the Abu Dhabi royal family, Etihad is thought to be keen to snap up potential bargains as the aviation industry suffers from soaring fuel costs and a big slowdown in consumer spending - with firms centred on leisure travel seen as more at risk.

The Midland carrier is said to be an Etihad target ahead of a reported option that Lufthansa has to take control of bmi later this year or early next year.

Lufthansa is understood to have made a private shareholders agreement in the 1990s.

This was carried out with bmi chairman, co-founder and majority shareholder Sir Michael Bishop.

Etihad chief executive James Hogan has strong links with bmi and Sir Michael, having worked as chief operating officer from 1999 to 2002, and was a member of the board.

With 11 per cent of the landing and take-off slots at London Heathrow, bmi is the airport’s second largest airline after British Airways.

The group is made up of the main bmi operation, as well as low-cost operator bmibaby which flies from Birmingham, and UK operator bmi regional.