Scotland business

Sale may lead to Scottish airline

bmi airline
Image caption Lufthansa, which owns BMI, has been reviewing its loss-making British subsidiary

Scotland could soon have a new airline, based in Aberdeen, BBC Scotland understands.

A group of Scottish aviation experts are closing in on a deal to buy BMI Regional.

They have plans to rebrand the carrier with a Scottish name, positioning it as 'Scotland's national airline' and expanding its route network.

BMI Regional flies 15 commuter aircraft from six British bases including Aberdeen, Edinburgh and Glasgow.

It specialises in the business traveller market, linking smaller cities in the UK and northern Europe, while a different division of BMI links Scotland with London Heathrow.

Lufthansa, the German carrier that owns BMI, has been reviewing its loss-making British subsidiary.

There have been reports that British Airways and Virgin Atlantic are battling over the valuable Heathrow landing slots controlled by the main part of the airline. Lufthansa has declined to comment on that.

Completion date

However, BMI told the 300 staff at the regional division on Friday that it is in "advanced discussions to sell BMI Regional to a UK-based investor group previously associated with the regional business".

It added: "Transaction documents will be signed shortly".

If it secures regulatory clearance, the completion date is expected by the end of the year.

It is understood the price is between £20m and £25m.

The BBC also understands those behind the venture include Ian Woodley, a founder of Business Air in Aberdeen 24 years ago.

Business Air later became BMI Regional, which is why the division has remained headquartered in Aberdeen.

For the next few months, it would continue to operate as BMI Regional, with its current flight codes and tickets booked through the BMI website.

The bidders then intend to rebrand, and to position it as 'Scotland's national airline'.

A source told BBC Scotland more staff would be hired at Aberdeen headquarters for engineering and IT.

The new owners hope to develop more routes for the Scottish market, including links to London airports other than Heathrow, and are looking for other small airlines as partners across northern Europe.

Wolfgang Prock-Schauer, chief executive of BMI, told staff: "BMI Regional will be an independent airline with management dedicated to developing the regional business and employment prospects will be enhanced through a planned growth strategy."

He went on: "It is our goal to find sustainable solutions for all parts of the BMI business and we, as well as the shareholder, continue to assess options for BMI.

"At this stage it is important to say that all the different options are still being explored and assessed and that no decision has been taken."