brand, a short-haul operation to be merged into Air Europe's existing short-haul operation using the BCal brand to serve business routes and the Air Europe brand to serve leisure markets as well as an engineering and a ground handling unit. BCal's senior management rejected ILG's renewed bid on the grounds that it still did not adequately reflect the value of the group's assets, in particular those of BCal. In addition, BCal's senior management felt that both airlines' nature of operations and their business strategies were incompatible and that therefore there were no synergies to be gained from combining BCal with what they regarded as "essentially a charter company". Air Europe's unsuccessful attempt to see off ailing Dan-Air The presence of Dan-Air, a major scheduled and charter operator at Gatwick and Manchester, Air Europe's two largest bases, meant that Air Europe was facing a potential competitor for every additional scheduled service and charter contract that became available. Dan-Air's large-scale presence at Gatwick, the airport's increasing scarcity of early morning peak time slots, and the fact that Dan-Air had already been licensed to operate scheduled services to some of the destinations Air Europe wanted to serve as well while only a quarter of London's and a third of the entire Southeast's population lived in Gatwick's catchment area also meant that attaining the "critical mass" to make its scheduled operation viable became an uphill struggle for Air Europe. This situation was made worse by the state of the British economy in the late 1980s, which was overheating and going to give way to a major recession during the early years of the following decade. In addition, the CAA's decision to re-allocate the licences for several of British Caledonian's short-haul Gatwick feeder routes, which British Airways had agreed to return to the licensing process as a concession to have its takeover of that airline approved, to Air Europe, Air UK and Dan-Air weakened the overall performance of the airport's scheduled services. As a result of this decision, Air Europe was excluded from the two main London—Scotland trunk routes and it was forced to compete head-on with Dan-Air to Paris Charles de Gaulle and Jersey. Dan-Air's growing financial problems at the time provided the impetus for ILG's high-profile publicity campaign not to miss an opportunity to run down its ailing competitor in the press, accusing it of operating old, "gas-guzzling" aircraft. As part of this