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Gate Gourmet set a deadline of Tuesday evening to reach a new commercial deal with BA or face the prospect of going out of business. The firm, owned by U.S. private equity firm Texas Pacific Group, sacked 660 workers almost two weeks ago. The move sparked an unofficial strike by baggage handlers, leading to flights being grounded and causing travel chaos for tens of thousands of passengers. Hot meals were being served Monday on BA's long-haul flights from Heathrow for the first time since the row flared, although short-haul passengers will continue to be given bags of cold food before they board. Many of the sacked workers continued to demonstrate Monday outside Gate Gourmet's offices at Heathrow, although the company obtained an injunction yesterday to prevent any intimidation of workers. Company executives have said the company will end up with "no choice" other than to go into administration if it does not do something to stem its £25 million-a-year losses. If Gate Gourmet goes into administration, the company would effectively be run by lawyers and could continue to provide a service to BA, but the move could equally lead to a new bout of disruption at Heathrow, a company source told Reuters. Gate Gourmet issued a statement Sunday saying it had won a High Court injunction to restrain unlawful action by the dismissed workers and intimidation from picket lines. A spokeswoman for British Airways said the airline was still in talks with Gate Gourmet over the weekend. She declined to say how much British Airways stood to lose over the catering row, although the Financial Mail on Sunday reported that the airline's loss had reached about £50 million ($90.2 million). "It's just too early to say," the spokeswoman said. Last week a source close to debt talks told Reuters that banks were considering foreclosing on Gate Gourmet's senior debt. Gate Gourmet set a deadline of Tuesday evening to reach a new commercial deal with BA or face the prospect of going out of business. The firm, owned by U.S. private equity firm Texas Pacific Group, sacked 660 workers almost two weeks ago. The move sparked an unofficial strike by baggage handlers, leading to flights being grounded and causing travel chaos for tens of thousands of passengers. Hot meals were being served Monday on BA's long-haul flights from Heathrow for the first time since the row flared, although short-haul passengers will continue to be given bags of cold food before they board. Many of the sacked workers continued to demonstrate Monday outside Gate Gourmet's offices at Heathrow, although the company obtained an injunction yesterday to prevent any intimidation of workers. Company executives have said the company will end up with "no choice" other than to go into administration if it does not do something to stem its £25 million-a-year losses. If Gate Gourmet goes into administration, the company would effectively be run by lawyers and could continue to provide a service to BA, but the move could equally lead to a new bout of disruption at Heathrow, a company source told Reuters. Gate Gourmet issued a statement Sunday saying it had won a High Court injunction to restrain unlawful action by the dismissed workers and intimidation from picket lines. A spokeswoman for British Airways said the airline was still in talks with Gate Gourmet over the weekend. She declined to say how much British Airways stood to lose over the catering row, although the Financial Mail on Sunday reported that the airline's loss had reached about £50 million ($90.2 million). "It's just too early to say," the spokeswoman said. Last week a source close to debt talks told Reuters that banks were considering foreclosing on Gate Gourmet's senior debt.
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