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The German airline is looking to raise cash after being threatened with a credit rating downgrade, and a full sale of BMI, which it took control of only two months ago, is one of the options that is open for discussion. The airline has been hit by the downturn in the aviation sector, posting a first-half loss of €216m (£187m), and has already cut its daily Frankfurt-Portland service.
Reports suggest it may already be in talks with Virgin over a complete or partial sale. Another option is breaking up BMI and selling its Heathrow take-off slots and regional operations separately. Any takeover or merger would have a severe impact on British Airways‘ dominance at Heathrow, where it runs 41pc of the outgoing flights. Stephan Gemkow, Lufthansa‘s chief financial officer, said in an interview with trade magazine Aviation Week last month: "It takes two to tango. If we find the right partner, we will dare to dance."
Kieron Daly, editor of Air Transport Intelligence, said: "There’s logic in it, as Virgin’s weakness has been not having any short or medium-term feed into their network. "With the situation Lufthansa have got themselves into, a quick solution looks attractive, but they are famous for playing the long game, so if anybody is going to resist being bullied by the market, it’s them. "It all comes down to whether Lufthansa have any long-haul aspirations in London. If they don’t, then the competitive impact of a sale will be very small. But the impact on BA could be enormous."
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