MERGER & ACQUISITION

Merger and Acquisition

Merger and Acquisition

Introduction

This paper intends to explore the takeover of Deutsche Lufthansa AG's loss making British Midland International airline by the International Airlines Group plc. Further, it examines the possible future impacts in long term and short term. In addition, some literature is reviewed regarding merger and acquisition of companies.

Discussion

Airlines Involved

International Airlines Group

International Consolidated Airlines Group, SA, known as the International Airlines Group (IAG), is the holding company created by the merger of British Airways British and the Spanish Iberia April 8, 2010. The new entity is a Spanish company, is headquartered in London and is listed on the London Stock Exchange and Madrid.

British Midland International

It was founded in 1938 as a training base for pilots. Since 1949, the company was known as Derby Aviation. In 1959, it was renamed Derby Airways, then in 1964 it was renamed as British Midland Airways. In 1986 the name changed to British Midland. In 2001 - BMI British Midland, and in 2002 became BMI. The base Airport is in London - Heathrow. Fleet airline bmi British Midland International is made up of aircraft Airbus A330-200, Airbus A321-200, Airbus A320-200, Airbus A319-100, Boeing 757-200, Embraer ERJ-145 Embraer ERJ-135.

BMI is a carrier of regular service based in Donington Hall, close to East Midlands Airport in the United Kingdom. The company flies to various destinations in Europe , America , the Caribbean and Israel . Their reference centers are Manchester Airport and the London-Heathrow, where their takeoffs and landings account for 11% of all facilities and operates over 2,000 weekly flights. bmi is the trademark of British Midland Airways Limited , a company that decided to replace the former British Midland. In January 2007, acquired the company bmi British Mediterranean Airways, an operation that allowed the airline to increase its destinations in Africa and the Middle East.

BMI and IAG

Last year in October 2011 International Airlines group announced that it is going to buy BMI, which is a subsidiary of Lufthansa German Airlines form 172,500,00 pounds which is equivalent to US $270.2 million.

Apparently, Lufthansa wanted to sell BMI as it was heavily suffering from losses. According to foreign media reports, in order to save the North African unrest caused huge losses, Deutsche Lufthansa (Deutsche Lufthansa AG) announced that it will sell its affiliates British Midland Airlines (of bmi). There were rumors before that Lufthansa is Germany-wing aviation, Midland aviation integrated into a low-cost airline "Lufthansa has made a comprehensive negation and announced the next step in a comprehensive acquisition of Austrian Airlines (AUA), the current acquisition plan is making good progress. The Midland Airways in 2009, completed the acquisition of different business model with other companies within the Group, but is still a subsidiary of the Lufthansa aviation's most serious losses. The UK market is the weakest in Europe, but the situation is still far better than North Africa.

Merger and Acquisition

The literatures have put their main focus on need and importance of M&A which remains as the key strategic option for various companies ...