Economy

Lufthansa poised to sign Air Berlin deal

Lufthansa poised to sign Air Berlin deal”

Lufthansa chief Carsten Spohr said Germany's largest carrier will take over 81 of Air Berlin's 140 leased aircraft and 3,000 of its roughly 8,000 employees, while investing €1.5 billion ($1.8 billion). Air Berlin triggered bankruptcy proceedings in August after losing a cash lifeline from its biggest shareholder Etihad Airways.

"We will see a milestone in the history of Lufthansa and Berlin today", he said.

Spohr said in Berlin that both airlines will sign the agreement later on Thursday in Berlin.

Investors believe that Lufthansa will profit from the debt-laden Air Berlin's breakup, driving up shares in the Cologne-based group by 2.4 percent, to 25.6 euros, on the Frankfurt bourse even before Spohr's announcement.

It said late last month that negotiations with Lufthansa and Britain's easyJet would continue until October 12.

Lufthansa may pay about 6 million for around 80 planes of Air Berlin.

Meanwhile, unions have complained that many of Air Berlin's staff faced an uncertain future despite promises when talks with Lufthansa and Easyjet began that most would find jobs with the bidders.

Flights continued after a transitional loan of €150m from the German government.

Mr. Spohr said that he expects that it will take up to one year for Lufthansa to fully integrate Air Berlin's aircraft and teams.

Spohr told the Rheinischen Post he did not believe Lufthansa's deal with Air Berlin would result in higher airfares.

Air Berlin's long-haul flights will cease at the end of this week, and tickets for all flights from the end of this month will be invalid.



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