Gate Gourmet demands better terms from BA

British Airways Plc, Europe's third- largest carrier, needs to sign a new contract with Gate Gourmet by Tuesday to prevent the U.K. unit of the caterer going into administration.

Gate Gourmet, owned by U.S. buyout fund Texas Pacific Group, sent a letter to the airline asking for an agreement with better terms by 5 p.m. Tuesday, said Marie Cairney, a spokeswoman for the catering company.

“Gate Gourmet needs a more favorable contract with British Airways,” Cairney said in a telephone interview. “It's a really severe financial situation.”

British Airways is recovering from a two-day strike this month when 1,000 of its employees stopped working to support union members fired by Gate Gourmet. The strike at London's Heathrow Airport stranded 100,000 passengers and may cost the airline 40 million pounds ($72 million), Bloomberg reminds.

As reported earlier, about 1,000 baggage handlers and loaders took unofficial action in support of workers at catering company Gate Gourmet who were sacked in a row over working practices. Terminals 1 and 4, those most used by BA, were the worst hit.

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