British Airways and Virgin Atlantic target BMI is reported to have net liabilities of £362 million and is heading for £145 million in operating losses this year.
The figures have reportedly emerged in an information memorandum circulated to bidders and seen by The Sunday Telegraph, according to a weekend report.
The document was prepared by Morgan Stanley, the adviser to Lufthansa, the German carrier wanting to offload a business that is on course for almost £650 million in operating losses in four years.
Lufthansa has been forced to inject a further £151 million of capital via a debt for equity swap and provide a £248 million intra-group loan since acquiring BMI in 2009 from former owner Lord Glendonbrook – the former Sir Michael Bishop – when he exercised a ‘put option’ that saw him gain £223 million.
Sixty five daily take off and landing slot pairs at Heathrow are in the BMI balance sheet for £345 million although it has since sold six of them to BA parent International Airlines Group for a rumoured £50 million, according to the newspaper. BMI holds 8.5% of slots at Heathrow – the main attraction to suitors.
The other main assets, alongside what Morgan Stanley calls the airline’s “highly attractive market positioning in London”, are £140 million of “aircraft-related assets” and a stake in the NATS air traffic control operator, valued at £41.7 million.