Lufthansa Prepares to Buy Parts of Air Berlin in $1.8 Billion Deal

Gladys Abbott
October 13, 2017

"We will see a milestone in the history of Lufthansa and Air Berlin", Spohr said.

The move drew fire from European competitors, which accused the German government of unfairly helping the Frankfurt-based Lufthansa get a leg up on the its EU rivals by offering Air Berlin a lifeline.

Lufthansa CEO Spohr said that he expected the imminent deal for Lufthansa with Air Berlin would receive necessary approval from the European Union before the end of 2017.

Air Berlin declared bankruptcy in August following years of losses and the decision of its biggest shareholder, Gulf airline Etihad, to cease financing. He said he decided not to submit a bid as it was a "conspiracy" between the German government, Lufthansa, and Air Berlin that would drive up prices for customers.

Lufthansa has agreed to purchase portions of insolvent German airline group Air Berlin for $249 million.

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Ryanair previously described the negotiations as a "stitch-up" meant to strengthen Lufthansa.

As part of the deal Lufthansa will take over Air Berlin's low-priced leisure airline Niki, its LG Walter regional airline as well as 20 additional aircraft - bringing the total to around 80 planes.

Further negotiations to pick up the leftovers of Air Berlin are ongoing with easyJet.

In 2016, Air Berlin showed a record 782 million euros in losses - a 75 per cent increase compared to 2015 - which the company attributed to restructuring costs and depreciation.

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