EU approves Lufthansa's Austrian Airlines acquisition

European Commission, the European Union's (EU) top antitrust authority has given its green signal to airline major Deutsche Lufthansa AG (Lufthansa) to takeover the ailing Austrian Airlines AG which will make the German carrier Europe's largest airline by sales, surpassing Air France-KLM.

The Commission also approved Austrian government's contribution of $715 million restructuring aid to the debt-laden airline. The approvals have been granted under conditions that are economically acceptable to Lufthansa, a statement issued yesterday said.

Through the deal, Lufthansa will acquire about 41.65 per cent stake in Austrian Airlines for approximately $480 million.

In addition, Lufthansa will pay $238 million to free-float shareholders for their shares. So far, the shareholders of Austrian Airlines have offered over 75 per cent of the necessary shares for sale in accordance with the takeover offer.

Lufthansa would purchase shares from all shareholders who have not yet accepted the offer, until eight days after making an announcement in the Austrian newspaper Wiener Zeitung.

Upon completion of the public takeover offer, Lufthansa will seek a squeeze-out of the minority shareholders of Austrian Airlines.