BMI reveals outline deal to sell BMIbaby to UK buyer

AIRLINE BMI has agreed the outline of a deal to sell its low-cost operation, BMIbaby, to an unidentified UK-based buyer, it announced last night. The East Midlands Airport-based operation's future has been uncertain since BMI itself was sold by owners Lufthansa to a consortium led by British Airways.

Reports last month had suggested that German company Intro Aviation was talking to Lufthansa about buying BMIbaby.

Intro had spoken about restructuring BMIbaby but BMI released a statement last night saying it had signed a term sheet - a document which outlines the basic details of a potential deal - with a UK-based company.

The term sheet does not stop it talking to other potential buyers, and it said in January that "several" parties were interested in the business. BMI declined to identify the company which has signed the term sheet.

In a statement it said: "The intended sale comprises 100 per cent of the shares of BMIbaby, all assets and liabilities used in the business including the aircraft fleet, the existing route network and the continued employment of the existing staff.

"It is envisaged that the legally binding transaction documents will be signed in the first quarter of 2012 and the completion of the transaction would occur shortly after this, subject to regulatory approval. The new potential owner would continue to use the existing brand name for an interim period. The published summer 2012 schedule would continue as planned and customers can continue to book flights via bmibaby.com and via the BMIbaby call centre."

The statement concluded: "BMIbaby's head office would remain in the Midlands and the airline would operate from its three existing bases in the UK: East Midlands, Birmingham and Belfast City.

"The potential new owner plans to further develop the low fare network in the UK and Europe."