British Airways parent International Airlines Group is being tipped to enter into exclusive talks to acquire loss-making BMI from Lufthansa within days.
Rival Virgin Atlantic has reportedly failed find to a partner to join it in a joint bid.
“The process has accelerated and gained fresh momentum. The start of exclusive talks – most likely with British Airways parent IAG – is expected in the next few days,” a source close to the sale process was reported to have told news agency Reuters.
Any deal for BMI could see its Heathrow landing slots – it controls 9% of the slots at the hub airport – bought for £300 million according to the report some of which could be handed to Virgin to ease competition worries.
Any prospect of an increase in slots at Heathrow look to have been ended with transport secretary Justine Greening saying the government would not review its position against a third runway and Labour changing its stance to oppose expansion too.
Reuters claimed the IAG deal could prompt a budget carrier to come in for low-cost carrier Bmibaby and that Lufthansa was talking to an interested party in the UK about the sale of BMI’s regional business.
BMI reported a loss of €154 million in the first nine months of 2011.