Lufthansa spreads wings by snapping up parts of failed Air Berlin

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Photo Lufthansa, Germany's largest airline, said it expected to take over 81 planes from Air Berlin, a low-priced carrier that filed for insolvency this summer.

Air Berlin, which has struggled to turn a profit over the last decade, filed for insolvency on Aug 15, and a government loan has kept its planes aloft while its administrator negotiated with prospective buyers for parts of the business.

Lufthansa chief executive Carsten Spohr said earlier he expected the Air Berlin deal to receive European Union approval by the end of the year.

A Lufthansa spokesman declined to provide further details because the agreement had not yet been signed.

Lufthansa has agreed to acquire Air Berlin's Austrian leisure travel airline Niki, its LG Walter regional airline and 20 additional aircraft, Air Berlin said in a statement.

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While Air Berlin officials have been in negotiations for weeks with Lufthansa and easyJet about selling parts of the business, the airline dealt with years of financial losses before its biggest shareholder, Gulf carrier Etihad, stopped financing the company.

German and worldwide investors and competitors lined up, with an eye not only on Air Berlin's aircraft but also coveted takeoff and landing slots at crowded airports.

Spohr rebuffed the accusation that Lufthansa was becoming a "threatening monopoly", pointing out that the airlines global market share was just 3% globally, and 14% in Europe.

Spohr told the Rheinische Post (link in German) on Wednesday that that the group had earmarked €1.5 billion ($1.78bn) for takeover-related costs, such as taking on Air Berlin employees. News of the deal pushed Lufthansa shares up more than 3 per cent to their highest level in almost 17 years.

The national airline of Italy Alitalia is also in administration and is seeking investors and Monarch the leisure airline based in Britain collapsed at the beginning of October.

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