'Number of inquiries' over Virgin Atlantic

Published on Wednesday 15 December 2010 14:58

Virgin Atlantic has fuelled speculation it could pursue a merger or tie-up after the airline said it had received "a number of lines of inquiry".

The carrier, which made a loss last year, said it has been contacted by other companies since it appointed Deutsche Bank at the beginning of November to assess the aviation industry and seek growth opportunities.

Virgin Atlantic said: "Following Deutsche Bank's recent appointment, we have received a number of lines of inquiry but it is far too early to comment on individual details.

"We expect Deutsche Bank's work to run on for a number of months but have nothing further to add at this stage."

The company refused to comment on media reports that American airline Delta is interested in a merger and may have hired investment bank Goldman Sachs to advise it.

It is understood that, if the two airlines formed an alliance, Virgin Atlantic would benefit from access to the SkyTeam alliance of 13 airlines from around the world.

Delta would benefit from gaining access to Virgin's landing slots at Heathrow.

Virgin Atlantic is not thought to have hired Deutsche Bank in direct response to its rival British Airways signing an agreement with American Airlines and Spanish airline Iberia.

BA last month completed a merger with Iberia as it looks to save costs in the increasingly competitive industry.

Virgin Atlantic, which is 51 per cent owned by Sir Richard Branson's Virgin Group and 49 per cent owned by Singapore Airlines, made an operating loss of 132 million in the year to 31 March on sales of 2.4 billion, which it described as one of its toughest years ever.

l Engine checks on the world's largest airliner following last month's Qantas emergency have scuppered Airbus's hopes of meeting a target of delivering 20 A380 superjumbos this year.

A spokesman said it would deliver just one more aircraft, on top of 18 which have already left the assembly line, instead of a further two.