16 October, etc.venues Monument
30 October, JW Marriott Grosvenor House
1st November 2023, etc.venues County Hall
Deal has until August 31
The Austrian Takeover Commission has approved Lufthansa's request to extend today's deadline for its planned takeover of Austrian Airlines.
Under the new terms of the deal, August is now the latest that Lufthansa can walk away from the deal.
But a deal is looking likely following recent indications from Lufthansa, the Austrian takeover regulators and the European Commission (EC).
"The process at the EU commission is far advanced and the approval of the deal is closer," said the Austrian commission.
"The extension of the deadline until August 31 will prevent a failure of the offer."
The Commission said a deal would favour Austrian Airlines' shareholders.
On Tuesday Lufthansa said it was seeking an extension on the July 31 deadline to give it time to agree new concessions with EC regulators.
The EC is currently investigating the proposed deal and has said it could make a quick decision if Lufthansa makes acceptable concessions on routes where competition was a concern.
Details of the concessions were made public yesterday following a report by the Dow Jones newswire which claims to have seen an EC document.
The questionnaire was sent to Lufthansa's competitors to ask whether the offer to give up slots on routes between Vienna and key European cities was enough to protect competition.
Three daily flights to Stuttgart and three to Cologne could be freed up as part of the deal.
Five flights a day to Frankfurt and up to four flights on Munich and Brussels routes may also be given up by Lufthansa.
The document said that the slots would be offered free to other airlines and any that take up the slots may participate in Lufthansa's frequent flyer programme.
Lufthansa is understood to have offered priority to airlines that are not fellow Star Alliance members.
Austrian budget carrier Niki, Slovakia's SkyEurope and Slovenia's Adria Airways have been singled out as being interested in the routes.
A Lufthansa spokesperson told ABTN the airline was confident of reaching an agreement with the EC.
On Tuesday (July 28) the EC said it had received a new offer from Lufthansa after intensive discussions over the weekend.
Lufthansa's previous package of concessions, submitted earlier this month, was quickly rejected by the EC which said further concessions had to be made.
If Lufthansa's latest offer is rejected, a decision on the EC's probe into the deal may not be made until November 6.
Lufthansa has indicated that it could walk away from the deal if concessions made the takeover "uneconomical".
Austrian Airlines has warned that it would need a €1bn cash boost should the deal with Lufthansa fall through, twice the €500m grant promised by the Austrian Government.
Austrian Airlines recently announced it was cutting around 1,000 jobs by mid-2010 to help make savings of €200m by 2012.
Austrian admitted that cuts had been made this year in the hope that the EC would approve its merger with Lufthansa.
The EC this month began a second investigation into the takeover, citing concerns that competition could be reduced on routes between Vienna other European cities.
Under the proposed deal Lufthansa agreed to pay the Austrian government €366,268 for its 41.6% stake in its national airline.
The second part of the agreement was that the Austrian state received a "debtor warrant" from Lufthansa which might lead to additional payments.
The last element was that the Austrian government paid Lufthansa €500m for a "capital increase" in Austrian Airlines.
Lufthansa's share offer for Austrian was approved by 85% of the shareholders, above the 75% threshold needed under the takeover terms.
The Commission said it was still considering "state support for Austrian Airlines in the framework of a separate investigation under EC Treaty state aid rules."
www.austrian.com www.lufthansa.com http://ec.europa.eu/index_en.htm