Sir Richard Branson offers BA boss a 1m bet over Virgin Atlantic deal – but gets a 'knee in the groin' instead
Billionaire Sir Richard Branson sells 49 per cent stake in airline to DeltaAmerica’s largest carrier will help keep Virgin Atlantic alive and take on BA
Branson tries to bet BA boss Willie Walsh 1m that airline will flourishBut Walsh says he hasn't got 1m and offers him 'knee in the groin' instead
20:50 GMT, 11 December 2012
See Sir Richard's Announcement Below:
The boss of British Airways’ parent company Willie Walsh has bet Sir Richard Branson ‘a knee in the groin’ that Virgin Atlantic will not survive five years.
And Sir Richard has accepted the remarkable challenge – saying the painful debt will be paid out to the loser at the winner’s headquarters.
The unusual ‘below the belt’ wager came after America's largest airline, Delta, took a 49 per cent stake in Virgin Atlantic under a major deal announced today.
Sir Richard tried to bet Walsh 1million that his Virgin airline would flourish after the deal. But Walsh said he did not have the cash and offered the 'painful' bet instead.
Depending on who wins, it raises the bizarre prospect on December 11, 2017 of airline staff witnessing Mr Walsh administering his low kick – or Sir Richard returning the favour.
Sir Richard Branson (right) announces via video link at a news conference that Delta Air Lines is buying a 49 percent stake in Virgin Atlantic Airways
Delta Airlines CEO Richard Anderson addresses a news conference today as he announces a $360million investment in Virgin as it tries to catch up to rivals in the lucrative New York-to-London travel market
The air-rage row erupted as Virgin boss Sir Richard announced he was retaining control of his airline Virgin Atlantic after a deal that will see America's largest carrier Delta Air Lines take a 49per cent stake. Sir Richard will retain the majority 51 per cent share.
Delta has paid 224million ($360million) to buy its new holding in Virgin Atlantic from Singapore Airlines, which paid 600million for the stake in 1999. Sir Richard said the Delta deal secures the airline’s future and marks ‘the start of a new era of expansion.’
Sir Richard was today on his luxury private Island of Necker in the British Virgin Islands while his team announced the Delta deal simultaneously in London and New York.
Mr Walsh meanwhile was in the South Korean capital Seoul to launch a new British Airways route.
But the spat – carried on over a distance of 7,000 miles and a difference of 14 hours across international time zones – marks the latest round of a long-running, long-distance slanging match between the two airline bosses.
It is also part of a deep-seated feud between the two airlines which harks back decades to an infamous ‘dirty tricks’ row.
The latest twist began when Mr Walsh suggested Virgin would not survive the tie up with Delta.
Sir Richard responded by offering IAG boss Mr Walsh a 1million wager that Virgin Atlantic – launched 28 years ago – would indeed survive.
Speaking in Korea, Mr Walsh, chief executive of British Airways’ parent company, the International Airline Group (IAG), said he could not afford 1million but was prepared to bet his rival ‘a knee in the groin’ that Virgin Atlantic would not survive five years.
He predicted that Sir Richard would have to relinquish control by selling some of his 51pc shareholding, leaving Delta free to erase the Virgin Atlantic name.
Mr Walsh told a press conference in Seoul, South Korea: ‘He’s a billionaire banker and I don’t think 1m would hurt him.
‘I don’t have 1million so maybe a bet that would be as painful for him as it might be to me. Maybe something like a knee in the groin.’
VIDEO: Richard Branson announces Virgin Atlantic – Delta deal:
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Arch rival Willie Walsh, CEO of British Airways parent company, bet Branson that Virgin Atlantic would not survive five years
The Delta and Virgin Atlantic model planes are on display at the conference. The airlines will begin a joint venture on 31 roundtrip daily flights between North America and Heathrow Airport
Mr Walsh said: ‘If he wants to bet that in five years’ time he will still own 51pc of Virgin Atlantic and it will exist in its current form …. that would be an interesting bet to accept.’
Mr Walsh also compared Branson unfavourably to outspoken Ryanair boss Michael O’Leary, who he labelled a ‘true pioneer’, despite Ryanair’s ‘awful’ service: ’I don’t see that the guy has anything that stands out in terms of what he’s achieved in the industry. I think O’Leary deserves great credit for what he’s done.’
Sir Richard responded in kind by writing on the social networking site Twitter: 'Happy to accept Willie Walsh's bet: loser to receive a knee in the groin – at winning airline's HQ.
‘We've got used to BA hitting below the belt over the years, but it would be the other way around on this occasion.'
And speaking on a video link from Necker Island, Sir Richard then hit back announcing: ‘Ignore the BA and press speculation. I’m not going anywhere.’
The boss of his new partner airline Delta, speaking at the press launch in New York, then also dived into the row.
Asked directly if he agreed with Mr Walsh that Delta would extinguish the Virgin name, Delta chief executive Richard Anderson said: ‘No. That actually makes my blood boil. Virgin is an iconic brand. ‘
To laughter he added without elaborating: ’‘I don’t know what the English term is, but we have a term in Texas….’.
The deep-seated animosity between Virgin and British Airways goes back to the so-called ‘dirty tricks’ campaign in which BA managers adopted underhand tactics to undermine Virgin ticket sales leading to the two airlines suing each other.
When the case came to court, in 1993, BA had to pay damages of 500,000 to Sir Richard and a further 110,000 to Virgin.