PlaneInsomniac
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LH buys majority of Air Berlin

Thu Oct 12, 2017 7:38 am

It seems the saga is ending. LH will today buy the majority of AB assets, including 81 planes, and plans to hire 3000 staff:

https://www.welt.de/wirtschaft/article1 ... erlin.html
Last edited by qf789 on Thu Oct 12, 2017 10:57 am, edited 1 time in total.
Reason: title updated
Am I cured? Slept 5 hours on last long-haul flight...
 
PlaneInsomniac
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:41 am

It's breaking news right now. Maybe use Google Translate or deepl.com?
Am I cured? Slept 5 hours on last long-haul flight...
 
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EK413
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:42 am

PlaneInsomniac wrote:
It seems the saga is ending. LH will today buy the majority of AB assets, including 81 planes, and plans to hire 3000 staff:

https://www.welt.de/wirtschaft/article1 ... erlin.html


Can't read German do we have English version?


EK413
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TOGA10
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:45 am

The natural function of the wing is to soar upwards and carry that which is heavy up to the place where dwells the race of gods. More than any other thing that pertains to the body it partakes of the nature of the divine. - Plato
 
hz747300
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:46 am

Will they fold it into the Wings brand? Flew AB Palma-Munich-Olbia, decent enough flights and on-time, definitely LCC land though.
Keep on truckin'...
 
PlaneInsomniac
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:48 am

Further details added: LH to invest 1.5 billion euros, may keep up to 80% of AB's 8000 staff. Sale to be notarized today (oct 12th) at noon. LH to offer "fairly priced" replacement tickets for AB passengers stranded abroad.
Am I cured? Slept 5 hours on last long-haul flight...
 
PlaneInsomniac
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:49 am

Article also states (some?) domestic AB routes will be taken over by Eurowings.
Am I cured? Slept 5 hours on last long-haul flight...
 
UAL777UK
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:50 am

Lets hope its a smooth transition and in particular the majority of AB staff get picked up by LH. So LH will end up being a powerful player in BER now I guess.
 
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KarelXWB
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Re: LH buys Air Berlin

Thu Oct 12, 2017 7:53 am

Story in English:

German media reports that Lufthansa Group is going to take over 81 Air Berlin aircraft (including subsidiary airlines Niki and LGW) as well as 3000 employees.

The internal talks between the two airlines were successful, LH Group and its low-cost subsidiary Eurowings are getting the biggest part of Air Berlin’s leftover.
Contracts will be signed in Berlin at 12:00 local time.

Lufthansa is paying 200 million Euro for the 81 Air Berlin aircraft and will invest a total of 1.5 billion Euro into the airline.
LH’s CEO Spohr says it may take the EU up to 3 months to make antitrust checks and give the green light for the takeover.


http://www.airlive.net/breaking-lufthan ... employees/
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TheFlyingDisk
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:05 am

Can they actually get antitrust approval to buy AB?
Last edited by TheFlyingDisk on Thu Oct 12, 2017 8:06 am, edited 1 time in total.
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runway23
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:06 am

Wonder where this leaves easyJet then ?

If easyJet get nothing and LH/EW everything then something is deeply wrong here...
 
Dardania
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:13 am

Shocked, I am, shocked!
 
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holcakker
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:15 am

Jesus Christ, who would have thought that this will be the outcome? :lol:
 
DartHerald
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:20 am

holcakker wrote:
Jesus Christ, who would have thought that this will be the outcome? :lol:


Just about everyone, I think! Was there ever any doubt?
 
downdata
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:20 am

And then there was one...
 
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Robisintheair
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:23 am

Let's s see what they'll announce in two hours. Very interesting part is, that Eurowings will get a "real" Business Class
 
PanHAM
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:23 am

runway23 wrote:
Wonder where this leaves easyJet then ?

If easyJet get nothing and LH/EW everything then something is deeply wrong here...


Easyjet has reduced their bids earlier this week, reportedly from 50 to 30 mio €. The question is not what EZY gets but what they want.

While LH will buy what they can without the competition watchdogs barking, no one else seems really interested in the corpse, especially when they can get the leftovers free of Charge. After today there is really no substance luft in AB
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FoxtrotSierra
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:34 am

I'm telling you guys, no one saw this coming.
 
Apiculteur
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:36 am

The "Spiegel" - article

(http://www.spiegel.de/wirtschaft/untern ... 72542.html)

states, that during the transition time LH is planning to use "Jumbos" on inner-german routes :twisted:

Whoa, man! If this is true, I'll be up in the air the next 6 - 9 months!
 
Airdolomiti
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:37 am

PlaneInsomniac wrote:
Further details added: LH to invest 1.5 billion euros, may keep up to 80% of AB's 8000 staff.


LH is only hiring 3000. The 80% refers to AB's previous statement that it was confident that about 80% of its 8000 staff would find employment elsewhere:

"[...] Air Berlin hatte mitgeteilt, die Airline sehe gute Chancen, dass etwa 80 Prozent der 8000 Mitarbeiter bei anderen Unternehmen einen neuen Arbeitsplatz erhalten könnten. [...]"
 
runway23
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:39 am

PanHAM wrote:
runway23 wrote:
Wonder where this leaves easyJet then ?

If easyJet get nothing and LH/EW everything then something is deeply wrong here...


Easyjet has reduced their bids earlier this week, reportedly from 50 to 30 mio €. The question is not what EZY gets but what they want.

While LH will buy what they can without the competition watchdogs barking, no one else seems really interested in the corpse, especially when they can get the leftovers free of Charge. After today there is really no substance luft in AB


We don't know what conditions are being imposed on easyJet either, so who knows what the fair price is or whether the conditions imposed make the deal unworkable. Ironically, it wouldn't be the first time easyJet walks away from a deal in Germany, they previously had the opportunity with DBA but withdrew their offer. That said, the airline and competitive landscape back then were both very different.

The end result here is that Germany now has almost no more competition on trunk routes, Lufthansa Group can do whatever they want now to prices. Quite interestingly some routes that were served by EW and AB out of DUS now have had their EW prices go up by 3-4x.

Believe what you want, but it seems both Etihad and LH Group walk out winners here. EY no longer has to pump money into the sinkhole that AB was, LH gets rid of competition and now controls all major German airports/cities (bar SXF but they have TXL...). EW will now go from being a marginal LCC carrier to one with a critical size albeit in a limited geographical area of Europe (compared to say FR or U2).

A couple of months back when rumours were floating that LH may buy parts of AB everyone was running around screaming, now LH comes out as the saviour of Germany - saving jobs and picking up parts that admittedly only LH could use.
 
Airdolomiti
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:42 am

Apiculteur wrote:
The "Spiegel" - article

(http://www.spiegel.de/wirtschaft/untern ... 72542.html)

states, that during the transition time LH is planning to use "Jumbos" on inner-german routes :twisted:

Whoa, man! If this is true, I'll be up in the air the next 6 - 9 months!


This was confirmed by LH a couple of weeks ago, albeit only for the month of November (at least initially): viewtopic.php?f=3&t=1374921&p=19849763
 
Apiculteur
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:47 am

Airdolomiti wrote:
Apiculteur wrote:
The "Spiegel" - article

(http://www.spiegel.de/wirtschaft/untern ... 72542.html)

states, that during the transition time LH is planning to use "Jumbos" on inner-german routes :twisted:

Whoa, man! If this is true, I'll be up in the air the next 6 - 9 months!


This was confirmed by LH a couple of weeks ago, albeit only for the month of November (at least initially): viewtopic.php?f=3&t=1374921&p=19849763


OK, thanks! I'll keep a look out!
 
SCQ83
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:51 am

PlaneInsomniac wrote:
Article also states (some?) domestic AB routes will be taken over by Eurowings.


They announced this week multiple daily Berlin-Karslruhe among other routes. That was a former AB route.
 
ltbewr
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:56 am

I suspect that this deal will have to clear EU anti-trust review with LH having to sell off some routes to other airlines to get that approval.

As some have noted as to the use of 'jumbo' aircraft on some intra-Germany routes by LH, perhaps they will be same flight-same plane flights starting in one German city to a 'hub' city in Germany then going on to longer haul international destinations in the middle east, Africa or even North America.
Last edited by ltbewr on Thu Oct 12, 2017 9:00 am, edited 1 time in total.
 
PanHAM
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Re: LH buys Air Berlin

Thu Oct 12, 2017 8:57 am

We will know more aout the Details later today. Fact is that we had domestic trunk routes ever since, like FRA to MUC / HAM and FRA TXL where AB was only marginally present. Competition is Deutsche Bahn rail and cheap air tickets have been available on Monopoly routes before and will be available in the future.

At the end of the day no one else was ready able and willing, except LH. LH could have just sit there and watch AB getting grounded and picked up the same Slots for free afterwards. They Chose the orderly and responsible way.

LH is certainly the winner, Etihad is the irrespnsible loser in this case, they should have closed AB years ago, even better, they should have invested in shaping the Company up, instead they just paid the losses while they thought that they could Play a part in Europe.

Next one who will ail on such a Project will be QR with Meridiana

Interesting interview with CEO Spohr in "Rheinische Post"
Was Erlauben Erdogan!!!
 
f4f3a
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:01 am

I imagine the deal is only going to be given approval if another bidder takes over the other part of the airline to provide competition. If u2 take over 30 a/c then this will be ok . For lh it is easy as niki and lgw are not bankrupt so can carry on flying while this takes place . For the 30 aircraft easy bidded for it was for them to be quote rented by easyjet until Eu approves it which could cost a lot of money . Hence this could be why the offer was reduced
 
PanHAM
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:02 am

ltbewr wrote:
I suspect that this deal will have to clear EU anti-trust review with LH having to sell off some routes to other airlines to get that approval.

As some have noted as to the use of 'jumbo' aircraft on some intra-Germany routes by LH, perhaps they will be same flight-same plane flights starting in one German city to a 'hub' city in Germany then going on to longer haul international destinations in the middle east, Africa or even North America.


Thexy have done their homework. What is signed and sealed today will hold up, especially since no one else except U2 was willing to buy anything. Even if, how can you sell somethnig when there are no buyers?
Was Erlauben Erdogan!!!
 
LH982
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:15 am

I'm sure they've done their homework and have structured it in a way that they know will be palatable to the regulators. It does however all look a little too cosy and a little too orchestrated, much like the auto industry.
 
oldannyboy
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:23 am

TheFlyingDisk wrote:
Can they actually get antitrust approval to buy AB?


Of course they will. This is all about saving jobs and protecting the German industry at large, and much less so about a monopoly that was virtually always in existence and well-established anyway.
 
oldannyboy
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:29 am

PanHAM wrote:
Next one who will ail on such a Project will be QR with Meridiana
"


Agree. Let's sit and take the pop-corn out. Trying to re-shape (or 'shape' actually), or doing anything meaningful with Meridiana will be no joke, trust me. Talking about badly-managed companies.....
I love how glitz&bling-top-of-the-range QR thinks they can grow a motley crew of a leisure carrier with no vision to speak of into Italy's new flag carrier...
 
runway23
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:32 am

PanHAM wrote:
Thexy have done their homework. What is signed and sealed today will hold up, especially since no one else except U2 was willing to buy anything. Even if, how can you sell somethnig when there are no buyers?


With all due respect, your view is a bit too naive.

There was interest from a number of airlines, each of whom could have made a proposal for parts of the airline.

Just because LH made a better offer than others (or had the backing of pretty much everyone here) does not mean there were no buyers.

Had AB folded in the way Monarch did, then the competitive landscape would have been a lot different.

In this case, EY had already "given" parts of AB to LH Group giving LH Group a foot in the door. The entire deal has been structured so that EY can get out of the mess without paying any further amounts and so that LH can obtain total dominance of the German market. The government with their intervention can claim they saved jobs, pumped a German group, etc... It is hard for anyone to claim that all of this was just an unfortunate (or fortunate) coincidence...

At this point what can Brussels really do ? They will most likely offer some remedy slots at TXL/DUS to some destinations. But behind the scenes LH with their powerful lobby and the German government will fight hard to limit this as much as possible.

The end result will probably be LH having 65+ % market share at almost all German airports they serve. No other airline in Europe has such dominance in so many different airports in their own country (be it UK, France, Italy, Spain) - despite the fact that each of these countries have seen the 2nd historical national carrier disappear one by one.
 
LTU330
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:34 am

LH982 wrote:
I'm sure they've done their homework and have structured it in a way that they know will be palatable to the regulators. It does however all look a little too cosy and a little too orchestrated, much like the auto industry.


It looks cozy and orchestrated because it probably was. When Frau Markell and Herr Spöhr went to the UAE together earlier in the year we already had rumours about AB being more or less swallowed by LH. It was not a coincidence that LH, who tried to block all AB/EY codeshares suddenly become good buddies with EY themselves. The word on the AB street though is that crews are no longer applying for jobs at EW instead holding out for a transfer of employment that will ensure keeping their current contracts for a year. I don’t know how this works out with relation to the saying that LH will take 3000 of the AB personnel because internal briefings had said everyone would have to apply at EW/LH because they would not just transfer people.
 
mjoelnir
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:35 am

In the moment it is difficult to define what LH bought. They bought parts of Air Berlin that included 81 airplanes and 3,000 of 8,000 staff according to the article. That leaves some frames and Air Nikki and LGW, frames belonging to LGW seems to be included in the 114 frames of Air Berlin.
Another question is if LH bought Air Berlin PLC that owns Air Berlin or only parts of Air Berlin itself. What about the Maintenance section and so on. Are all airlines Air Berlin bought integrated in Air Berlin or owned separately by Air Berlin PLC?
It seems that there is something left for EasyJet to buy according to the article.
 
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CARST
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:43 am

LTU330 wrote:
LH982 wrote:
I'm sure they've done their homework and have structured it in a way that they know will be palatable to the regulators. It does however all look a little too cosy and a little too orchestrated, much like the auto industry.


It looks cozy and orchestrated because it probably was. When Frau Markell and Herr Spöhr went to the UAE together earlier in the year we already had rumours about AB being more or less swallowed by LH. It was not a coincidence that LH, who tried to block all AB/EY codeshares suddenly become good buddies with EY themselves. The word on the AB street though is that crews are no longer applying for jobs at EW instead holding out for a transfer of employment that will ensure keeping their current contracts for a year. I don’t know how this works out with relation to the saying that LH will take 3000 of the AB personnel because internal briefings had said everyone would have to apply at EW/LH because they would not just transfer people.


From what I understood they are directly buying ABs daughter companies Niki and LGW. If they really buy these companies and not only their assets (= more or less only the planes) then they also buy every contract with the employees.

So this means, LGW and Niki employees would remain on their old contracts and LGW and Niki would probably operate as subsidaries of Eurowings or LH Mainline. BUT, for the "about 20 extra frames" LH plans to take over from core AB, they won't take over any employees, because the AB and ex LTU employees earn too much. To man these 20 frames with cockpit and cabin crew they will offer new contracts at Eurowings (for less pay of course).
 
Nicoeddf
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:47 am

Not sure where so many take their fear of a lack of competition from.

LH Group has a market share of 14% in Europe, hardly dominant and so there can't be an argument for lack of competition within Europe.
As to domestic traffic: Germany is a tiny Country. Not too many worthwhile domestic routes apart from connection to long haul. The competition, expectedly, is rail and car, even long-distance busses now. Hence a worthwhile comparison is not market share at airports, but market share of total travellers between domestic city pairs. Plenty of competition in that field.
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LTU330
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:49 am

mjoelnir wrote:
In the moment it is difficult to define what LH bought. They bought parts of Air Berlin that included 81 airplanes and 3,000 of 8,000 staff according to the article. That leaves some frames and Air Nikki and LGW, frames belonging to LGW seems to be included in the 114 frames of Air Berlin.
Another question is if LH bought Air Berlin PLC that owns Air Berlin or only parts of Air Berlin itself. What about the Maintenance section and so on. Are all airlines Air Berlin bought integrated in Air Berlin or owned separately by Air Berlin PLC?
It seems that there is something left for EasyJet to buy according to the article.


The 81 Aircraft is Niki, LGW and the already wet leased 37 or 38 Aircraft flying for Eurowings and Austrian i believe. Air Berlin Technik is a separate entity, and although it had to file for insolvency because it’s only customer was Air Berlin, it is in fact profitable in its own right. The interesting thing is LH said it has no interest in expanding its own Technik. Air Berlin Technik has the contract for the wet lease Aircraft for six years. This can change of course if It shuts down, but the time for investors or buyers for Technik runs until the end of this week. Then negotiations will start, if we can believe our Management of course !
 
LH982
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:55 am

Nicoeddf wrote:
Not sure where so many take their fear of a lack of competition from.

LH Group has a market share of 14% in Europe, hardly dominant and so there can't be an argument for lack of competition within Europe.
As to domestic traffic: Germany is a tiny Country. Not too many worthwhile domestic routes apart from connection to long haul. The competition, expectedly, is rail and car, even long-distance busses now. Hence a worthwhile comparison is not market share at airports, but market share of total travellers between domestic city pairs. Plenty of competition in that field.


I would love to see their market share in Stuttgart. Germanwings, Eurowings, Austrian, Swiss, SunExpress, Air Berlin. It's all just LH in disguise
 
LTU330
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Re: LH buys Air Berlin

Thu Oct 12, 2017 9:58 am

CARST wrote:
LTU330 wrote:
LH982 wrote:
I'm sure they've done their homework and have structured it in a way that they know will be palatable to the regulators. It does however all look a little too cosy and a little too orchestrated, much like the auto industry.


It looks cozy and orchestrated because it probably was. When Frau Markell and Herr Spöhr went to the UAE together earlier in the year we already had rumours about AB being more or less swallowed by LH. It was not a coincidence that LH, who tried to block all AB/EY codeshares suddenly become good buddies with EY themselves. The word on the AB street though is that crews are no longer applying for jobs at EW instead holding out for a transfer of employment that will ensure keeping their current contracts for a year. I don’t know how this works out with relation to the saying that LH will take 3000 of the AB personnel because internal briefings had said everyone would have to apply at EW/LH because they would not just transfer people.


From what I understood they are directly buying ABs daughter companies Niki and LGW. If they really buy these companies and not only their assets (= more or less only the planes) then they also buy every contract with the employees.

So this means, LGW and Niki employees would remain on their old contracts and LGW and Niki would probably operate as subsidaries of Eurowings or LH Mainline. BUT, for the "about 20 extra frames" LH plans to take over from core AB, they won't take over any employees, because the AB and ex LTU employees earn too much. To man these 20 frames with cockpit and cabin crew they will offer new contracts at Eurowings (for less pay of course).


I agree about the ex LTU people, but according to our former leader Herr Pichler, our AB contract people earned less than the EW people, and in fact we lost a lot of them to EW when they got their A330s. What I do think is that with so many people looking at the Arbeitsamt then they can drop the pay offers even more. I have friends who got offered about 1000 euro/month less at LH Technik compared to others who went there at the start of the year. For an experienced licensed Aircraft inspector (B1 with three types on license) to be offered 3300 Brutto per month is not good. When I left the UK 15 years ago, the same qualified and experienced B1 was on 40000 pounds sterling per year which even at today’s exchange rate is about 3700 Euros per month. So LH can try to get the people for really low prices now.
 
PanHAM
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:01 am

runway23 wrote:
PanHAM wrote:
Thexy have done their homework. What is signed and sealed today will hold up, especially since no one else except U2 was willing to buy anything. Even if, how can you sell somethnig when there are no buyers?


With all due respect, your view is a bit too naive.

There was interest from a number of airlines, each of whom could have made a proposal for parts of the airline.

Just because LH made a better offer than others (or had the backing of pretty much everyone here) does not mea.


I am too old to be naive and old enough to be realistic since I've seen it all before.

Showing interest is less than window Shopping. No one of These "other carriers" came up with a serious bid. LH and U2 came out as the only bidders and even here, U2 seems not to be so faithful of it's own committment.

About Germany, LH's market share Overall has never been over 50% and won't go over that markk with the new Akquisition. The German market is poycentric while most other countries are centralized. It is a lot easier to establish 2 carriers at LHR, but even there Virgin could not maintain a Feeder Service. While Germany has at least 8 centres which have to be connected or given up to the competition..
Was Erlauben Erdogan!!!
 
Bhoy
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:04 am

And what about the 5 Belair Aircraft that operate ex-Switzerland in Air Berlin livery? (Two of their four A321s are leased from AB, and they have a single A320 left, too)
 
LH982
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:09 am

Bhoy wrote:
And what about the 5 Belair Aircraft that operate ex-Switzerland in Air Berlin livery? (Two of their four A321s are leased from AB, and they have a single A320 left, too)


I think Belair was supposed to die at the end of this month.
 
LTU330
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:12 am

LH982 wrote:
Bhoy wrote:
And what about the 5 Belair Aircraft that operate ex-Switzerland in Air Berlin livery? (Two of their four A321s are leased from AB, and they have a single A320 left, too)


I think Belair was supposed to die at the end of this month.


That is what we were told when the EW wet lease deal was signed, that the aircraft would go to Niki and Belair would close, but I see nothing updated about it since then !
 
runway23
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:23 am

Supposedly Small Planet are interested in Belair but no news on that front. It would have made sense to integrate Belair into Edelweiss or Eurowings.
 
WIederling
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:25 am

runway23 wrote:
Wonder where this leaves easyJet then ?

If easyJet get nothing and LH/EW everything then something is deeply wrong here...


There may be something wrong or not.

But not just because EasyJet or some of the other bidders didn't get access.
Murphy is an optimist
 
r2rho
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:47 am

No surprises here. This orchestrated operation was decided in February during Spohr & Merkel's visit to UAE, and Winkelmann as trojan horse has done a great job of handing AB over to LH on a silver plate.

The devil will be in the details - nobody really cares how many a/c LH buys. The actual concern will be the slot situation in restricted MUC, DUS and TXL after this deal is finalized. I hope more details become available soon on this, because this is what will impact consumers most

Fact is that we had domestic trunk routes ever since, like FRA to MUC / HAM and FRA TXL where AB was only marginally present. Competition is Deutsche Bahn rail and cheap air tickets have been available on Monopoly routes before and will be available in the future.

You should know better than this. AB's domestic presence was not "marginal" - those routes were their most successful, and numbers backing it have been posted in the other thread. A 6hr DB ride was not - and will still not be - competition versus air, that's precisely why those routes could support multiples daily frequencies on 2 airlines. A quick dummy booking on the LH website suggests that "cheap" tickets will -not- be available in the future on monopoly routes.

Not sure where so many take their fear of a lack of competition from.
a worthwhile comparison is not market share at airports, but market share of total travellers between domestic city pairs. Plenty of competition in that field.

The first statement is correct. The second is not. You will find plenty of statistics posted about that in the "insolvency" thread, I will not repeat them. The "plenty" competition on those routes was only AB.

Showing interest is less than window Shopping. No one of These "other carriers" came up with a serious bid. LH and U2 came out as the only bidders and even here, U2 seems not to be so faithful of it's own committment.

With so much hapening behind closed doors since february, we will never know. Other bidders may not have been seriously invited to the party, or walked away once they realized the whole thing was orchestrated anyway. IMO U2 was only invited to whitewash the whole operation and give it the impression of an "open" bidding process. But once again, we don't know what was discussed at that fateful meeting in february.
 
mjoelnir
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:53 am

LTU330 wrote:
mjoelnir wrote:
In the moment it is difficult to define what LH bought. They bought parts of Air Berlin that included 81 airplanes and 3,000 of 8,000 staff according to the article. That leaves some frames and Air Nikki and LGW, frames belonging to LGW seems to be included in the 114 frames of Air Berlin.
Another question is if LH bought Air Berlin PLC that owns Air Berlin or only parts of Air Berlin itself. What about the Maintenance section and so on. Are all airlines Air Berlin bought integrated in Air Berlin or owned separately by Air Berlin PLC?
It seems that there is something left for EasyJet to buy according to the article.


The 81 Aircraft is Niki, LGW and the already wet leased 37 or 38 Aircraft flying for Eurowings and Austrian i believe. Air Berlin Technik is a separate entity, and although it had to file for insolvency because it’s only customer was Air Berlin, it is in fact profitable in its own right. The interesting thing is LH said it has no interest in expanding its own Technik. Air Berlin Technik has the contract for the wet lease Aircraft for six years. This can change of course if It shuts down, but the time for investors or buyers for Technik runs until the end of this week. Then negotiations will start, if we can believe our Management of course !


There were 114 aircraft registered to Air Berlin including LGW, excluding Niki, that includes only 5 A330-200. There are 16 frames registered to Niki, + 2 with non Austrian registration, that would make it 130 or 132 all together. So 81 frames leaves out quite a bit. Take away LGW, 20 Dash8-400Q, Niki, 16 frames, that still leaves 96. 96 minus 81 are still 15 frames.
Something must be bought by somebody else or returned to lessor.
 
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Revelation
Posts: 16639
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Re: LH buys Air Berlin

Thu Oct 12, 2017 10:59 am

TheFlyingDisk wrote:
Can they actually get antitrust approval to buy AB?

According to Reuters ( https://www.reuters.com/article/us-air- ... SKBN1CH0SS ), "Spohr said on Thursday he expected Lufthansa’s imminent deal with Air Berlin would get European Union approval by the end of the year.". Nothing left to chance, says I.

holcakker wrote:
Jesus Christ, who would have thought that this will be the outcome? :lol:

It's the exact outcome predicted weeks ago. The original title of this thread was misleading. LH didn't "buy" AB, it's picking up the pieces it wants (presumably at an acceptable price) and leaving the rest behind (presumably for others to fight over or for them to be washed away by insolvency).

runway23 wrote:
The end result here is that Germany now has almost no more competition on trunk routes, Lufthansa Group can do whatever they want now to prices. Quite interestingly some routes that were served by EW and AB out of DUS now have had their EW prices go up by 3-4x.

Believe what you want, but it seems both Etihad and LH Group walk out winners here. EY no longer has to pump money into the sinkhole that AB was, LH gets rid of competition and now controls all major German airports/cities (bar SXF but they have TXL...). EW will now go from being a marginal LCC carrier to one with a critical size albeit in a limited geographical area of Europe (compared to say FR or U2).

A couple of months back when rumours were floating that LH may buy parts of AB everyone was running around screaming, now LH comes out as the saviour of Germany - saving jobs and picking up parts that admittedly only LH could use.

The Reuters article says:

Shares in Lufthansa were up 2.9 percent at 25.27 euros, the top gained in Germany’s DAX market index <0#.GDAXI> by 0800 GMT after Spohr’s comments and upbeat notes from brokerages.

Analysts at Bernstein Research raised their rating on Lufthansa’s shares to “outperform” from “market-perform”, saying they expected a deal with Air Berlin to add around 70 to 90 million euros to annual operating profits at Lufthansa’s budget unit Eurowings in the medium term.

HSBC analysts lifted their target share price to 29 euros from 25 euros, citing the imminent agreement with Air Berlin, a new multi-year labor deal with pilots announced this week and a positive trading performance this year.

So the monied interests are pleased, and why wouldn't they be: LH Group gains EUR 70M-90M annual profits with minimal investment and minimal risk, and near total control of the air market in the German speaking world.
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PanHAM
Posts: 9362
Joined: Fri May 06, 2005 6:44 pm

Re: LH buys Air Berlin

Thu Oct 12, 2017 11:12 am

We all know that there are, in reality, just 3 Groups in EU and LH is one of them If there were other bidders except the usual bigmouth, they woud have shown up.There is also an Explanation why U2 seems to be a bit reluctant and that is Monarch. Just across the street at Luton and here the questio is, how much can U2 handle? Here the lower bid could make sense. It is not only the purchase Price but also the Support until the the operations make Money.

LH can finance the Transaction from their own financial resources. No other carrier outside the EU3 is in that Position. Simple fact.
Now, don't Forget that there is also Leisure Cargo for which Zeitfracht in Berlin is interested. If they attract the founder to come back from retirement it could be a good deal for them.
As to that February Meeting - the writing was on the wall for years, no one can say that the demise of AB came from the blue yonder. Of course will such a Situation lead to talks, being prepared is part of the Business and the duty o board members. But the rulers of AUH surprised the German government and LH by efusing to fulfill their financial committment . They did not transer a 50 Mio € Tranche which meant that the LBA would have by law pulled the AOC.

In that Situation quick Action was needed, we have discussed thet before.IMHO there was nothing fateful about that Meeting. The obvious had to happen and the government should have acted long before
Was Erlauben Erdogan!!!
 
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Erkki
Posts: 7
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Re: LH buys Air Berlin

Thu Oct 12, 2017 11:28 am

runway23 wrote:
Wonder where this leaves easyJet then ?

If easyJet get nothing and LH/EW everything then something is deeply wrong here...


easy Jet takes Air Berlin Technik, but it's just a small part...

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