Lufthansa Prepares to Buy Parts of Air Berlin in $1.8 Billion Deal
Oct 13 2017
Lufthansa will pay around €210 million ($248 million) to buy 81 of Air Berlin's planes and take on 3,000 of its 8,500 employees, as well as take over Air Berlin's Austrian leisure travel airline Niki, and regional airline LG Walter.
Air Berlin, which has struggled to turn a profit over the last decade, filed for insolvency on Aug 15, and a government loan has kept its planes aloft while its administrator negotiated with prospective buyers for parts of the business.
Lufthansa has spread its wings further, clinching a deal to buy up more than half of its bankrupt rival Air Berlin, in what its CEO Carsten Spohr described as "a milestone in the history of Lufthansa and Berlin".
Talks to sell some of Air Berlin's remaining assets to Britain's easyJet and other bidders are continuing, Air Berlin said, without providing details.
He added that 80 planes was the largest addition to Lufthansa's fleet that competition authorities would accept.
"We will be referring the matter to the European Union competition authority in due course", a Ryanair spokesman.
But Spohr told business daily Handelsblatt today that "we expect the competition authorities to examine the takeover at least from the point of view of European competition, not limit it to the German market alone".
Air Berlin, Germany's second largest carrier, will cease operating flights this month, capping a turbulent summer for European carriers.
Air Berlin triggered bankruptcy proceedings in August after losing a cash lifeline from its biggest shareholder Etihad Airways.
German and global investors and competitors lined up, with an eye not only on Air Berlin's aircraft but also coveted takeoff and landing slots at crowded airports.
Lufthansa shares were up over 2.9%, which was the highest mover on the DAX market index in Germany in Thursday morning trading.