Lufthansa confirms interest in airberlin takeover

TIN news:  Lufthansa has confirmed an interest in taking over airberlin; however, the German carrier will look to Abu Dhabi’s state-owned carrier Etihad Airways to take care of airberlin’s debts.

Etihad owns a 29.2% stake in oneworld member airberlin, which has debts of €1.2 billion ($1.3 billion).

“The debt problem can only be resolved by the government of Abu Dhabi,” a Lufthansa spokesperson in Frankfurt told ATW.

In January, Lufthansa Group chairman and CEO Carsten Spohr had told ATW that airberlin’s debts were “much too high to attract an investor.”

Germany’s second largest carrier airberlin reported a €781.9 million loss ($824 million) for 2016, deepened from a €446.6 million loss in the year-ago period. For the 2017 first quarter, airberlin posted a net loss of €293.3 million, widened from a €182.3 million loss in the year-ago period.

Airberlin said 2016 and 1Q 2017 were dominated by the transition to a new business model. The old business model and high restructuring costs had a huge impact on last year’s results.

As part of a restructuring plan at the end of 2016, airberlin had agreed to a commercial partnership—called Air Berlin Aeronautics—which will go into operation by the end of the year. The deal includes a six-year, wet-lease agreement of 38 airberlin Airbus A320 aircraft with Lufthansa Group subsidiaries Eurowings and Austrian Airlines.

This move should ensure the 38 Airbus aircraft can continue to operate.

In case of a possible takeover of airberlin by Lufthansa, the remaining 75 aircraft would be integrated into Eurowings’ fleet, which should reach 160 aircraft by the end of 2017. Spohr predicts Eurowings would become profitable in 2018