The European Commission (EC), the executive body for the European Union, has released a statement defending its decision to approve the sale of British Midland International (bmi), an airline owned by Germany-based Lufthansa, to British International Airlines Group (IAG), the parent company of British Airways.
Earlier Virgin Atlantic, an airline subsidiary of UK-based Virgin Group, had announced its intention to appeal against the sale of bmi, although the sales process will not be affected by this appeal. Virgin Atlantic has claimed that the EC has approved the sale too quickly, and the 14 airport slots that BA are giving up at Heathrow airport, as a proviso of the £172.5 million deal, were insufficient to ensure healthy competition in the UK aviation market.
In a statement, the EC has clarified its stand by saying, ‘We are confident that the commitments proposed by IAG address all competition issues identified and we stand by our decision to clear the transaction subject to these conditions.
In this case, a decision was reached in 35 working days, which is not particularly fast. For example, out of 319 adopted merger and acquisition decisions in 2011, 98 percent were adopted within this timeframe.
Moreover, as described in our best practices guidelines, the commission held in-depth pre-notification contacts with the parties as early as November 2011, well before the notification took place on February 10, 2012.’
Virgin Atlantic will be able to appeal to the General Court of the EU within two months of publication of a full report by the EC on the sale of bmi to IAG.
