Friday, December 05, 2008

Lufthansa acquiring Austrian Airlines, despite union opposition

Austian Airlines-LufthansaIt's official: Lufthansa is acquiring Austrian Airlines. The Austrian government, which is the major stakeholder in Austrian Airlines, officially approved the sale today. Peter Michaelis, CEO of the Austrian state holding company ÖIAG, and Lufthansa CEO Wolfgang Mayrhuber (pictured at right) signed a contract which transferred ÖIAG's 41.6% stake in Austrian to Lufthansa for EUR 366,268.75. Lufthansa also intends to acquire all the remaining shares of Austrian Airlines. The total price is expected to reach about EUR 377, according to news reports.

A statement to the press about the deal says that Austrian Airlines will be managed as a profit center in the Lufthansa Group, but will remain a "broadly independent" airline with its head office in Austria, its own brand, fleet and crew.

Mr. Mayrhuber said there are no plans at present to cut jobs at Austrian, however it should be noted that union groups at Austrian opposed this deal. Agence France-Presse reported that the labor representatives on ÖIAG's supervisory board all voted against approving the acquisition.

"The circumstances surrounding the sale process, the offer that Lufthansa has put on the table, and the many open questions about it are the main reasons why the labour representatives on the board voted against the sale," union representative Leopold Abraham told AFP.

Terms of the deal still must be approved by the European Commission.

[Photo Source]