FlyerTalk Forums - View Single Post - IAG and Lufthansa reach agreement in principle on the sale of British Midland Ltd.
Old Dec 3, 2011 | 4:50 pm
  #437  
NickB
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Originally Posted by h15t0r1an
Ummmm I think I read somewhere that DC is actually a profitable part of BMI.... (like to huge tax now charged on redemptions might be a factor!!)
I assume that it is but it remains to be seen how much money it makes. Being profitable and making a substantial contribution to the bottomline is not the same thing and I would suspect that what IAG regards as an acceptable ROI is not quite the same as what BD would regard as an acceptable ROI.
DC has zero strategic importance to BA to the raw numbers would have to work pretty well to be worth the effort and complication of another non-core unit. While I have no insider knowledge whatsoever nor any hands on experience of the economics of FFPs, I have my doubt that the figures would stack up impressively enough for DC to be really worth it for BA.
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