Air Miles Sale Could Ease BA's Pension Deficit

25 July 2006

LONDON: British Airways revealed last week it is continuing to review its ownership of Air Miles, amid speculation that the long-running loyalty scheme could be sold.

Private equity group European Capital is a possible buyer for £25 million, although the Sunday Times reported that BA will take £200 million of cash out of Air Miles in return for providing a guaranteed allocation of 'free' flight seating.

The mooted disposal coincides with BA's expected payment of £500 million ($1.86bn; €1.47bn) to alleviate its staff pension scheme deficit, reportedly doubled to £1.8 billion since its last actuarial valuation three years ago.