Lufthansa is now in final negotiations with ÖIAG (Österreichische Industrieholding AG / Austrian industry-holding stock corporation) for Austria’s 41.6% stake in Austrian Airlines. According to Austria Press Agency, Air France-KLM and Russia’s S7 had expressed interest in the ownership stake, but “are no longer in the bidding process.” Austria made the decision to sell the airline after reviewing the carrier’s $1.127 billion debt. For the three months that ended September 30, Austrian Airlines posted a loss – and it seems as though the Austrians will leave the fixing of the company to the “pro.”
Lufthansa has a nice history of helping / taking control of airlines. Already, Lufthansa owns Swiss International Air Lines, as well as a nice stake in JetBlue and Brussels Airlines. Expected to be completed this upcoming January is Lufthansa’s purchase of BMI (British Midland Airways). It almost seems as though Lufthansa is buying up everyone these days. Yet, I think Lufthansa plays things smart; considering they did not pursue Alitalia.
A stake in Austrian Airlines is a good move by Lufthansa. Austria is a neighboring country to Germany, which may have some impact in the cooperation between the two airlines. I’m curious to see what Lufthansa gets out of this. Unlike Lufthansa’s deal with Brussels Airlines, Austrian Airlines is already a member of the Star Alliance. The controlling stake may help the two carriers cut costs and reduce frequencies on over-served routes even further.
Image: flickr.com
