Bmi has taken over British Mediterranean (Bmed), a franchise partner of British Airways.
Bmed specialises in serving destinations in the Middle and Near East, Africa and Russia on behalf of BA. It operates a fleet of narrow-bodied Airbus A320 and A321s in a two-class (business and economy) configuration. It has been largely funded by Middle East money and has suffered traffic losses on its main Beirut route following the recent conflict in Lebanon.
The agreement struck between Bmi and Bmed specifies that Bmed's existing routes and schedules will be retained during a transitionary period until the end of the summer season.
Bmi chairman Sir Michael Bishop, CEO Nigel Turner and deputy CEO Tim Bye have been appointed to the Bmed board with immediate effect. David Richardson will retain his position as Bmed chief executive reporting to Nigel Turner. All existing non-executive directors of Bmed have resigned.
It's not clear at this stage whether Bmi will honour every existing Bmed route from the end of the summer.
But the deal would seem to make sense both for Bmi and the Star Alliance carriers at Heathrow. Bmed has slots at Heathrow, and it also has a small fleet of planes (Bmi is short of aircraft to fuel its expansion plans). Bmi is keen to develop more routes to the Middle East and Russia (where Bmed covers a number of cities). Bmed also feeds many thousands of passengers to the Oneworld network at Heathrow and these travellers might now transfer to Star rivals.
Report by Alex McWhirter