Lufthansa’s Takeover of Austrian Remains Unknown

Lufthansa’s takeover of Austrian Airlines remains up in the air. This news came in after the chief executive of Lufthansa, Wolfgang Mayrhuber, met with the Europe’s top competition regulator last night to look over the new concession from the airline.

The new terms that have been made are to address the regulator’s fears over the lack of competition if these two airlines join together. The fear exits on routes between Vienna and a number of other European cities.

Just last Friday, European Competition regulators gave a very cautious reaction to the latest proposal from Lufthansa. Thus, this simply means that the completion of this deal still remains uncertain.

The European Competition commissioner, Neelie Kroes, has invited the Lufthansa head to meet to discuss the new terms. European Competition officials say that they need further clarifications and remained tight-lipped as to whether the most recent proposals were sufficient.

This approval process has been bogged down for several weeks now over a number of routes, which Lufthansa should give up in Vienna. However, Lufthansa’s insisting it could not relinquish the amount the European Competition Commission has wanted for fear that it would make the deal uneconomical.

Just last week Lufthansa managed to secure additional cost savings from Austrian’s unions. Of course, Lufthansa’s main European rival Air France has been very critical of the deal, as it does involve a state aid of €500 million. Experts say that clearing this deal could be far from over, with the European Commission continuing to be unsatisfied with Lufthansa’s propsals.