Airport News

British Airways parent International Airlines Group is holding early-stage talks with Lufthansa over bmi, the loss-making unit of the German airline, two people familiar with the situation said.

"IAG has not been shy about its interest in bmi, and the two sides have been in contact, discussing options, but I'm not sure it has got to the offer stage yet," said one of the sources on Friday.

Another source said Lufthansa was also in talks with other suitors, but did not give any names.

Virgin Atlantic is one of those involved in the bmi sale process, chief executive Steve Ridgway said on Tuesday.

Lufthansa has said finding a partner for bmi is one of the options it is exploring as it tries to turn around the airline, and has mandated bankers to sound out a potential sale.

Bmi's biggest assets are its slots at London Heathrow. Citigroup analyst Andrew Light last month estimated these to be worth around EUR€460 million (USD$630 million).

IAG boss Willie Walsh has made no secret of his interest in bmi, and BA last month acquired six daily take-off and landing slots at London's Heathrow airport from bmi for an undisclosed sum.

The sources said it was unclear whether the talks between IAG and Lufthansa would be successful.

"Virgin Atlantic could yet throw a spanner in the works," one of the people said.

Lufthansa and IAG declined to comment.