Aviation: BA gets bmi as little sister

The acquisition has raised competition issues because the newly enlarged group will have more than half of the landing slots at London's Heathrow Airport.

Virgin Atlantic, always a vocal critic of BA's dominance, is put in an especially difficult position: bmi is a code-share partner for a number of Virgin's European flights.

bmi has been in the doldrums for years. The former British Midland Airways rebranded itself British Midland International and got a swish new image and the awful lower-case initials. In 2010, it renamed itself British Midland International - but kept the three-lower-case letter logo and is still generally referred to in that way.

But IAG's deal is not a complete take-over: bmiregional and bmibaby (a low-cost carrier) are not included in the deal, originally flagged in November 2011.

It has been widely reported that Virgin, which considered bmi to be an important feeder partner, has for almost a decade been interested in taking it over but no deal has ever been done.

It has been reported that a Virgin/bmi link would give the pair a combined share of 17% of slots at LHR against BA/Iberia's 43%. But bmi has hundreds of slots and the IAG link will lift the enlarged group's share of slots to more than 50%.

That appears to bring the deal within the scope of EU competition rules and Virgin's Sir Richard Branson says he intends to insist on a referral to the EU Competition authorities if the UK's own authorities do not intervene.

bmi has been steadily losing money since 2008 and it suffered a major hit when its then new transatlantic services were badly affected in the aftermath of 11 September 2011. That destabilised the business and it has been through a succession of ownership sales since.