British Airways has struck a secret deal to buy a parcel of lucrative runway slots at Heathrow from BMI British Midland, one of its biggest airline rivals.

The transaction, the biggest of its kind in recent years, will add to the speculation over the future of BMI, which is regarded as a prime takeover target thanks to its ownership of 12% of Heathrow’s scarce runway capacity.

Although neither company would comment on the deal today, it is understood BA paid around £30 million for 51 slots a week.

BA is eager to buttress its position at Heathrow ahead of the advent of “open skies” between Europe and the US in April next year. This will move restrictions on flights from Heathrow to the US, and open up BA to open competition on transatlantic routes for the first time.

Analysts at ABN Amro today published research suggesting that flights across the Atlantic account for 65% of BA’s profits, and that open skies could see profits from those routes fall by between 25 to 53%.

Slots on Heathrow’s runways are the most sought after in world aviation. The airport’s two runways operate at 98.5% capacity. The only free slots left at the airport are late at night, too late to be attractive to most airlines. Heathrow's owner BAA, was today referred by the Office of Fair Trading to the Competition Commission for an inquiry that could eventually lead to its break-up. BAA faces a separate Competition Commission review into proposed charges to airlines at its UK airports.

Slot-trading is regarded by some as illegal, but despite this there is a thriving grey market. Few deals are disclosed publicly, although BA has in the past given some details of its transactions. Its previous biggest deal was in 2003, when it bought eight pairs of slots from Swissair, the Swiss flag carrier that later collapsed in financial turmoil.

Airline executives said that the price paid by BA appeared cheap. “Paying £3.4m per pair (the normal method for valuing slots) seems a very good deal. Pairs have changed hands for £10m,” one said.

BMI recently bought a British Mediterranean Airways, a BA franchise airline, for £30m. British Mediterranean flies to central Asia and Syria and Lebanon in BA colours and using BA flight codes. BA could have stopped the sale under the terms of the franchise agreement, but did not.

But a BA source today denied there was any connection between the two transactions. “The slot deal has nothing to do with British Mediterranean,” the source said.

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