Reuters/Frankfurt
Etihad Airways threw a lifeline to ailing Air Berlin and gained access to more European routes by raising its stake in the German airline to 30% and lending it $255mn.
Etihad CEO James Hogan (right) and Air Berlin CEO Hartmut Mehdorn hold up airplane models at a press conference in Berlin yesterday. Air Berlin, which sees synergies of €35mn-€40mn in 2012 from the deal, will move its Middle East offices from Dubai to Abu Dhabi and will offer four flights a week from Berlin to the Gulf state from January 15, the companies said
Abu Dhabi-based Etihad will buy new shares in Air Berlin, Germany’s second-biggest carrier after Lufthansa , for about €73mn ($95mn), raising its stake to 29.21% from just below 3%, Air Berlin said yesterday.
It will buy 31.5mn new shares at Friday’s closing price of €2.31.
“This is good news for Air Berlin shareholders because Etihad Airways is a strong anchor investor and the capital increase ... will improve the low equity ratio,” DZ Bank analyst Robert Czerwensky said.
The deal includes a codeshare agreement giving Etihad access to Air Berlin’s dense European short-haul route network, and to the German capital ahead of rival Emirates , which has lobbied for years to be allowed to fly to Berlin.
Middle East carriers such as Etihad, Qatar Airways and Dubai-based Emirates have been aggressively expanding route networks, provoking fears that Gulf-based superjumbos would draw traffic from European carriers’ hubs.
Air Berlin, which sees synergies of €35mn-€40mn in 2012 from the deal, will move its Middle East offices from Dubai to Abu Dhabi and will offer four flights a week from Berlin to the Gulf state from January 15, the companies said.
So far, Etihad offers Frankfurt, Munich and Duesseldorf as German destinations. Emirates declined to comment on the deal.
Etihad has been named repeatedly by media as a possible investor for Air Berlin, as well as for Lufthansa’s bmi and Aer Lingus, but has so far brushed off such reports.
“Although the Air Berlin deal does not necessarily preclude further deals, it does make them less likely short-term,” analysts at Espirito Santo said in a note.
A source familiar with the bmi sale said talks were at the final stage and that only Virgin Atlantic and British Airways were bidding for the carrier.
Etihad chief executive James Hogan told Reuters there were no immediate plans for any further acquisitions but said he would always take a look at good opportunities.
