November 1, 2017 / 4:23 PM / in a year

Lufthansa kicks off Air Berlin approval process with EU

BERLIN (Reuters) - Lufthansa (LHAG.DE) has begun the European approval process for its takeover of large parts of insolvent Air Berlin AB1.DE.

FILE PHOTO: A Lufthansa airliner taxis next to an Air Berlin aircraft at Tegel airport in Berlin, Germany, October 12, 2017. REUTERS/Hannibal Hanschke/File Photo

The deal has come under fire from airlines and consumer groups who fear it will give Lufthansa dominance of German domestic routes and in Austria.

A spokesman for Lufthansa said on Wednesday it had notified the European Commission.

“We can confirm the transaction has been notified, the provisional deadline is Dec. 7,” a Commission spokesman said in an email. The preliminary review can be extended by 10 working days should Lufthansa offer concessions.

Lufthansa last month said it planned to acquire Air Berlin units Niki and LG Walter, plus additional aircraft in a deal that will expand its fleet by 81 aircraft.

The purchase price is 210 million euros (£184 million) but Lufthansa expects to invest around 1.5 billion euros in total, including paying for the planes and other items such as staff training and repainting planes.

The group was hoping for a so-called Phase I approval from the Commission, without an in-depth review, so that the deal could close in January and it could start using the Air Berlin capacity, CEO Carsten Spohr said last week.

He said he expected that, as with Lufthansa’s previous takeovers, it would have to give up take-off and landing slots in order to gain approval for the Air Berlin deal.

Britain’s easyJet (EZJ.L) is also taking on some Air Berlin operations at Tegel airport.

Reporting by Victoria Bryan, Foo Yun Chee and Ilona Wissenbach; Editing by Alexander Smith and Edmund Blair

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