The Bids Are In: Who Is Interested In Taking Over Airberlin?

Germany’s second largest airline, airberlin, filed for insolvency a month ago, on August 15, 2017. As we’ve known all along, the German government provided a loan of 150 million EUR so the airline could continue to operate while interested parties submitted bids for any or all of airberlin.

Interested parties had until today to submit offers for airberlin. Then airberlin’s creditors will discuss the offers on September 21, 2017, while a final decision on who to sell to will be made on September 25, which is just a day after Germany’s federal elections.

Reuters has the scoop on what parties may be interested in taking over parts of airberlin. While the deadline for bids was today, they suggest that offers made over the coming days will still be considered. Airberlin has a fleet of about 140 aircraft, most of which are leased, and they have some airport slots that are potentially interesting to airlines as well. I think it’s safe to assume that no investor is interested in taking over airberlin “as is.”

While we don’t have all the details yet, several interested parties have shared their general intentions.

Lufthansa is apparently interested in taking over up to 90 planes, in a deal that would be worth hundreds of millions of EUR:

A source familiar with the matter said Lufthansa planned to offer a three-digit millions of euros sum for up to 90 planes, including Austrian holiday airline unit Niki’s fleet and 38 crewed planes it already leases from Air Berlin.

EasyJet may be interested in up to 40 of airberlin’s planes, to take over part of their shorthaul flying (which makes sense, since the airline has been trying to expand within Germany):

“EasyJet has this afternoon submitted a proposal to the overseers of Air Berlin’s insolvency to acquire parts of its short-haul business. The proposal is consistent with easyJet’s focused, city-based strategy in Germany. However, given a number of uncertainties associated with Air Berlin, there is no certainty at this stage that any transaction will proceed.”

Then you have a smattering of other bids, ranging from buying airberlin’s maintenance business, to buying the entire airline:

Meanwhile former Formula One motor racing world champion Niki Lauda has put in a joint bid with German airline Condor, owned by holiday firm Thomas Cook, a spokeswoman for Lauda said.

He had told Austrian media that he would make an offer worth around 100 million euros for Niki, an airline he once owned, and 17 Air Berlin aircraft. Thomas Cook declined to comment.

Separately German family-owned logistics firm Zeitfracht has offered to buy Air Berlin’s cargo marketing platform, its maintenance business and regional unit LGW, which operates 20 Bombardier aircraft.

And aviation industry investor Hans Rudolf Woehrl has offered to buy Air Berlin in its entirety for 500 million euros, to be paid in installments, while China’s LinkGlobal Logistics has asked to be given more time, until Sept. 21, to formulate a bid.

Airberlin’s union isn’t happy about the fact that the announcement will be delayed until September 25, saying that the delay is at the “expense of the workers, who want a decision on their jobs and their future.”

I’ll be very curious to see how this plays out…

Comments

  1. “Hi, we’d like to wait until we see all the other bids before providing our own. Thank you, LinkGlobal Logistics”

    Is that how bidding works in China?

  2. So, prospectus investor trying to buy AB’s airport slot. Is the slot transferable without prior approval of the airport authority?

    Nevertheless, its funny to see chinese corporation trying to impose their bussines culture to a german one. Lol

  3. There is much more to the assets I’m sure but to me is it really worth buying?
    The fleet is all leased so even if you wanted the planes wouldn’t it just be better to negotiate your own lease instead of take over what they have?
    They own “slots” so OK those could be valuable but most are in Germany so the real attraction to those is for LCC’s who want a way in. I guess that is the real value at the end of the day.

  4. There are now rumors in German media that IB is also interested in parts of AB.

    (If true, my guess is they want some routes for VY.)

  5. I see IAG’s bid more as a defensive move to prevent an even larger portion of continental European market share falling into LH Group.

    It’s funny all the vultures who sat there with popcorn earlier while LH Group was the one trying to help out AB are now crying foul over how the Germany government is giving “favoritism” to LH.

    i don’t see how the bid by Hans Rudolf Woehrl will be successful. It sounds grandeur on paper by keeping everything as-is, but without rectifying the underlying problems, they’ll be back on the road of rescue-and-bail-out just a few years later.

    The BER airport delay is just a convenient excuse. Not even Changi Schiphol or Incheon grade airport could’ve saved AB from its fate.

  6. @ henry LAX:

    LH group helping AB out? Seriously? It’s more like LH being the first vulture circling above the carcass.

  7. @Flip : by your theory, then Ryanair et al must’ve been too dumb to jump onto that opportunity when it first presented itself.

  8. @Rob and @James. For the Chinese company, it is more likely because they need state approval first. Nowadays , even for a legit private investment the Chinese government will put a close scrutiny to prevent large amount hard currency flow out of country. Although they have the largest foreign reserve among all countries, they are very nervous about a quick panic run of money.

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