3rd Nov 2006 07:01
British Airways PLC03 November 2006 PROPOSED SALE OF BA CONNECT TO FLYBE British Airways announced today that it has reached agreement in principle tosell the regional operation of its subsidiary airline BA Connect to Flybe. BA Connect also operates from London City Airport and between Manchester and NewYork. These services will not form part of the proposed sale nor will theregional ground handling business, British Airways Regional Ltd. Willie Walsh, British Airways chief executive said: "Point to point regionaloperations are not a strategic part of our business and we believe that suchactivities are better undertaken by a regional low cost airline. "Despite the best efforts of the entire team at BA Connect, we do not see anyprospect of profitability in its current form. "The proposed sale to Flybe provides the best opportunity to secure thelong-term future for the many dedicated staff in BA Connect. British Airwayswill have a 15 per cent investment in Flybe on completion of the disposal. "London City services complement our mainline business at Heathrow. For thisreason they are not included in the proposed sale." It is envisaged that once the sale of the regional business of BA Connect toFlybe is completed, there will be a transition period until the start of thesummer schedule on March 25, 2007 while the handover of responsibilities isundertaken. ends November 3, 2006 108/SR/06 Notes to editors The proposed transaction is subject to a number of conditions including boardapproval, documentation and due diligence. British Airways announced a write down of £106 million of its investment in BAConnect. There is not expected to be a further material profit or loss ondisposal. BA Connect, based in Manchester, employs 1900 staff and operates 52 routes from13 UK regional airports. The airline is expected to carry 3.5 million passengerson regional services in 2006/07. Flybe, based in Exeter, employs 1800 staff in the UK regions and operates 101routes from 21 UK regional airports. The airline is expected to carry 6 millionpassengers in 2006/07. Certain information included in these statements is forward-looking and involvesrisks and uncertainties that could cause actual results to differ materiallyfrom those expressed or implied by the forward looking statements. Forward-looking statements include, without limitation, projections relating toresults of operations and financial conditions and the Company's plans andobjectives for future operations, including, without limitation, discussions ofthe Company's Business Plan programs, expected future revenues, financing plansand expected expenditures and divestments. All forward-looking statements inthis report are based upon information known to the Company on the date of thisreport. The Company undertakes no obligation to publicly update or revise anyforward-looking statement, whether as a result of new information, future eventsor otherwise. It is not reasonably possible to itemize all of the many factors and specificevents that could cause the Company's forward looking statements to be incorrector that could otherwise have a material adverse effect on the future operationsor results of an airline operating in the global economy. Information on somefactors which could result in material difference to the results is available inthe Company's SEC filings, including, without limitation the Company's Report onForm 20-F for the year ended March 2006. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
International Airlines