BA's £1 billion approach to bmi?

[Pete]

Nestling in this report about an approach from a U.S. investment group to buy Iberia, there's a note that BA have reportedly offered to buy bmi for £1 billion, although industry analysts value it at £500 million.

Obviously the real value of bmi is now in it's LHR slots, so industry analysts are probably looking in the wrong column in their spreadsheets.

why is it that there is one rule for america and another for everyone else.
The americans werent happy with British contol of Virgin america and now americans want to own a company in abroad in the same industry that they said no to VA about this is a bit hypocritical.
I think that Iberia should say no straight away.
just my opinion . (no offense to americans)

[Pete]

I'd be quite happy for the U.S. to be able to buy a European airline - we live in a free economy.

However, they have to equally allow foriegn investors to own a majority share in their carriers - otherwise it's simply protectionism and an unfair playing field.

[preiffer]

Since when did the US consider world trade as anything OTHER than an unfair playing field, Pete?


(Can't wait until China gets bigger than them in 4/5 years time - ooooh, the humility to follow... [:w])

America are only doing what the Uk government should have been doing for our industries.
Fair play to them.
As for China, that will all fall apart eventually. Unsubstainable growth and costs

For the last nine months I've been in Korea, I've witnessed endless protests against the US-Korea Free Trade negotiations. Sometimes they've been quite violent, and the Riot police have been quite heavy handed (almost communist chinese!) in breaking them up.

I've wondered what all the fuss is about.

Then over the weekend, agreement was reached, and there has been endless commentry on CNN about "What a great deal it is for America", no mention of what a great deal it also is for Korea.....

Perhaps that's why the Koreans have been so anti FTA.

Then again, if you want to see a "closed economy" come to Korea. There are no foreign brands here at all.


Alan,

I wouldn't write China off too soon. The government is cash rich, and pretty much bankrolling the US economy with trillions invested in US government bonds.
They've gotten a lot of people rich through manufacturing and exports, and now they have an extremely affluent internal market that will outstrip the size of exports to the US in not too many years.
Once that happens, China could be in a very strong position, in that it won't be so reliant on the US market, and could pretty much criple the dollar with a big sell off of their currency reserves if they wanted.
Of course there's the rampant corruption, cripling pollution and rural unrest to contend with, but if they can get through that, I'd say it was time to start banking in RMB.

[preiffer]

Originally posted by PVGSLF
Then again, if you want to see a "closed economy" come to Korea. There are no foreign brands here at all.

Try B&Q Home - Albeit in South Korea.

Ah yes! B&Q I forgot them.... There's also a "Tesco's" type JV, and the usual fast food and coffee chains.
But the mighty Wal-Mart left with its tail between its legs, and look on the shelves at these places and you'll be hard pressed to find non korean brands.
Probably what the UK should have done in the 60-70's with the "Buy British" campaign. Backed it up with massive import duties.[:?]

[Scrooge]

Strange thoughts on this one.

I agree that if a US airline is allowed to invest in an EU airline, then EU airlines should have the right to invest in US airlines, that is the basis of free trade.

Not wanting to turn this into a political debate though I do have to point out a couple of things.

If the US were to slap the types of duties on Chinese products that the Chinese government put on US products entering China then we really would not have to worry about where China will be in 5 - 10 years, the Chinese economy would stall, the same can be said for many countries, Japan and Korea come to mind.

World trade is a two way street, one that in general the US plays very fairly on, what we are seeing in the airline business is an old law being used by modern day airlines to protect their home turf in the face of a weak domestic market.

Fair point Dave.

And not wishing to turn this into an FTA debate, but i've got no one else to talk to at the moment , it's all over the news here, and has got the anthropoligical part of me interested.

China, Korea, Japan all slap massive import duties on things, and yet go to Japan or China and you'll see as colourful collection of foreign brands as anywhere (Granted, most of the big consumer names we recognise in the west are Japanese!)
I think the Korean psyche is that all things non Korean are bad, and FTA or not, American brands will still really struggle in Korea.


Yet in the "west" do we really care anymore about where our things are made or who is investing in or running our companies.

As you say the US airlines thing is purely self interested weak airlines using an old law to protect themselves.

[Scrooge]

Yep, now for year Japan has slapped massive duties and draconian inspections on cars, if the US were to ever match that Japanese duties and inspections you would see the Japanese auto makers struggling big time.

For many years (my POV here) the US has used it's massive economy as a kind of stabilizing force in many parts of the world, keeping friendly economies humming through low or no duties on imports from them to the US.If the US ever matched the other governments import polices all hell would break lose....and of course the US government would be branded as racist etc