"Customers will benefit" airlines claim
The European Commission today (June 22) approved the take over of SN Brussels Airlines by Lufthansa.
But it ruled the deal was subject to the implementation of a "set of remedies" put forward by the German carrier to meet concerns over competition.
Under the deal, Lufthansa will take a 45% stake in the Belgian airline for €65m.
It will have an option to buy the remaining 55% of shares from the stakeholders which include the Virgin Group from 2011.
The EC said its "in-depth" prove into the merger confirmed it would have "raised competition concerns on the routes Brussels-Frankfurt, Brussels-Munich, Brussels-Hamburg and Brussels-Zürich."
To meet these worries, Lufthansa has offered opportunities, including airport slots, for competitors to enter the four markets.
With the safeguards in place, the Commission said the deal would "not significantly impede effective competition" in the European Economic Area.
Neelie Kroes, the competition commissioner, said: "The comprehensive remedies package offered by Lufthansa will facilitate market entry on the affected routes and thereby create alternative choices for passengers.
"In the light of the current consolidation process in the European airline sector, the Commission takes great care to safeguard the interests of consumers in having a competitive choice of airline services in Europe."
The EC said the remedies "not only target the problem of slot congestion, which is an important entry barrier on the problematic routes, but generally enhance the attractiveness for new entry on these routes."
The EC investigation was launched in January after the two airlines announced their merger plans.
In a joint statement Brussels Airlines and Lufthansa said they expected the deal to be completed by the end of the month.
They added: "Regulatory clearance will enable both carriers to realise synergies and intensify their cooperation to the benefit of their respective customers.
"Harmonised schedules, which will lead to improved connections at the Frankfurt, Munich, Zurich and Brussels hubs, are just one of the advantages that customers can look forward to in future."
Brussels Airlines said it would enable Brussels Airport to connect with the rest of the world.
The Commission approved Lufthansa's plans to acquire UK carrier bmi in May but is still looking into the German airline's offer to buy up Austrian Airlines.
http://ec.europa.eu/ www.lufthansa.com www.brusselsairlines.com