Singapore Airlines is in the mood to shed a little weight in the form of its 49% stake in Virgin Atlantic, and it seems Delta Air Lines is among the suitors lining up to try to talk the company into handing that nice little slice over. Whoever gets this hunk of the company will gain access to some pretty sweet slots at London’s Heathrow airport.
After the sale, the new owners will work with Richard Branson’s Virgin Group, which will keep its 51% stake no matter who buys the rest, reports Reuters.
Singapore Airlines is playing it coy so far with just a simple statement that it’s talking to unnamed interested parties, adding that there might be no deal when all is said and done. Virgin is keeping relatively quiet as well.
“We are always talking to many airlines on a number of different matters but we never comment on the details of these discussions,” a Virgin Atlantic spokeswoman said.
Heathrow is an attractive deal for airlines, as it’s got limited capacity and shuttles lots of corporate passengers through it on a daily basis. Virgin Atlantic has some primo landing spots, as it’s the second-largest carrier at Heathrow.
Delta had been eyeing a hookup with Air France as well, as the European Union dictates that EU airlines remain under European control. So Delta would need to wheel and deal with Air France in order to gain access to Virgin Atlantic and control it. That is, if Branson wanted to give up a little more of his stake, which a source tells Reuters isn’t likely.
“As far as he (Branson) is concerned, it is just Singapore Airlines’ 49 percent stake that is up for sale – he is keen to maintain control of Virgin Atlantic and form a stronger airline,” the source said, adding Branson supported a deal with Delta because it would make Virgin Atlantic stronger on routes between Britain and the United States.
Delta and Air France are staying mum so far, likely because Delta tried for a stake in Virgin Atlantic in the past and failed. If it can pull this one off, it’d be a nice feather in its hat and give competitors like American Airlines and British Airways a run for their money.