British Airways and Lufthansa jump on bmi sale rumours, Air France-KLM performs well

Shares in Air France-KLM were up 3.7%, while Lufthansa also performed well (+3.9%), as media reports suggest the carrier held talks with Virgin Atlantic regarding the possible sale of bmi or a merger between the two London-based carriers.

Lufthansa Group’s latest consolidated traffic data, which included UK-based bmi for the first time in Jul-2009, showed bmi has been impacting on the Group’s load factors, particularly the cargo segment, where bmi reported an average load factor of just 16.6% last month. Total Group ASKs last month rose by 5.7%, but without bmi, there was a decline of 1.0%. Group RPKs rose 6.2%, but would have fallen by 0.2% without bmi. Group passenger load factor increased 0.4 ppts to 83.1%, but without bmi, the load factor would have been higher at 83.4%.

Another solution arising from talks with Virgin Atlantic includes the option to sell bmi’s London Heathrow slots to carriers including British Airways. A sale of bmi’s regional operations to rival airlines, such as Flybe, is also a possibility. British Airways' shares jumped 7.2% on Friday.

Europe selected airlines daily share price movements (% change): 21-Aug-09