BERLIN – Lufthansa said Wednesday its supervisory board had approved a deal to acquire Austrian Airlines AG, giving one of Europe's biggest airlines more routes across the continent and beyond.
The Cologne-based Lufthansa said its board had agreed to acquire the 41.6 percent stake held by Austria's privatization agency, or OeIAG, for euro366,000 $463,000 and, pending the Austrian airline's performance, pay another euro162 million.
The deal is subject to regulatory approval along with OeIAG's supervisory board, which meets on Friday. Also key to the deal is approval by the European Union that euro500 million in restructuring aid floated by Austria's government be approved, one of the conditions that Lufthansa set in October to ensure that Austrian's debt would be assumed by the state.
Shares of Lufthansa were down slightly by 0.1 percent to euro10.32 in Frankfurt.
Austria's government decided in August to sell off its share in the ailing flagship carrier, which is steeped in euro900 million of debt.
Austrian posted a net loss of euro16.4 million for the three months that ended Sept. 30, compared with a profit of euro20.6 million a year earlier. Lufthansa's third-quarter profit in the July-September period slumped to euro149 million from euro586 million a year earlier, depressed by higher fuel costs. It also cut its full-year earnings outlook, citing the economic uncertainty.
Still, despite the crisis facing the European airline industry over what were volatile fuel prices and falling passenger numbers, Lufthansa has been on an acquisitions tear.
In October, Deutsche Lufthansa AG locked up valuable takeoff and landing slots at Heathrow Airport with its decision to increase its stake in British Midlands to 80 percent after it agreed to pay Michael Bishop, BMI's main shareholder, euro400 million for his 50-percent stake.
The remaining 20 percent of BMI is owned by Scandinavian airline SAS.
In September, Lufthansa acquired a 45-percent equity stake in Brussels Airlines with an option to buy the rest in 2011. Lufthansa said it sees Brussels operating largely as an independent company in the Lufthansa group.
That's largely the way Lufthansa has handled its acquisition of Swiss International Air Lines, which it announced in 2005.
In late 2007, Lufthansa announced it would buy a 19 percent stake in American carrier JetBlue Airways Corp., giving it access to more North American business.
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