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Lufthansa closes on Austrian Airlines

Lufthansa closes on Austrian Airlines German carrier Lufthansa is closing on its proposed takeover of Austrian Airlines after it was selected as the sole bidder, it has emerged.

It was announced in August that the Austrian government intended to sell its stake in the struggling national flag-carrier.

This was predominantly motivated by the approximately €900 million (£774 million) of debt which the airline is operating under.

OeIAG, the privatisation agency handling the sale of the Austrian government's 41.6 per cent stake in the airline, announced yesterday that Lufthansa has been selected for final negotiations.

The agency said in a statement that it "will conduct final negotiations only with Lufthansa from this point on", reports the Austrian Press Agency.

This statement also confirmed that Air France-KLM and Russia's S7 operator are now "no longer in the bidding process".

Any additional details about the sale, including the agreed price for the Austrian government's stake, have not so far been revealed by either party.

However, it is understood that Lufthansa has called the Austrian government to take on €500 million of the airline's debt before things can proceed.

Lufthansa spokesman Patrick Meschenmoser declined to comment on the talks or any conditions being levied "in accordance with the rules of the proceedings".

Peter Michaelis, OeIAG boss, stated his belief that negotiations over the sale will be completed "within a month".

Austrian Airlines reported a €16.4 million net loss during the three months leading up to 30 September 2008.

This compares to the €20.6 million profit which it reported in the third quarter of 2007.


Airline News posted on 14 November 2008

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