Beginning of the end for bmi

Today is a day that has been a long time coming.  About nine years to be exact.  It was nine years ago that Lufthansa purchased a sizable stake of British carrier British Midlands, now known as bmi.  As part of that purchase certain stock options were defined that essentially would force bmi’s primary shareholder to sell his controlling interest (50% + 1 share) in the airline to Lufthansa sometime early next year.

In a release filed today it was announced that the paperwork has been signed and that a date has been set for that transaction: January 12, 2009.  At that point Lufthansa will find itself in control of about 16% of the slots as London’s Heathrow airport, putting them in second place behind British Airways for access there.

This also means that bmi’s Diamond Club program is almost certainly on its last legs.  Perhaps another year or so to go, but it will almost certainly be subsumed into Lufthansa’s Miles & More program as part of this transaction.  And that sucks.  Diamond Club was perhaps the best frequent flyer program out there today.  Qualification for their top tier had a relatively low threshold of 55K points and requalification was ridiculously low at 38K points.  Flying in the USA in a domestic F seat could earn one 300% credit, and some of those fares can be downright cheap if booked as an upgrade fare.  I’ll be doing just that in 10 days as I bounce around the western part of the country picking up points on the cheap and in a relatively big comfy seat.

But the best part of Diamond Club was the redemption value for their points.  In a move that was unique in the industry, bmi offered a cash + miles redemption that actually had real value to it, particularly for long-haul travel in the pointy end of the plane.  And since that’s where we all want to be anyways, seeing this option starting to disappear is a sad day.  Time to start planning a whirlwind trip (or trips) to cash in these points, especially now that the dollar is a bit stronger against the GB Pound.