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Austrian Airlines Takes Off Into New Future With Lufthansa

Austrian Airlines
December 19, 2008

Supervisory Board of ÖIAG agrees to sale in meeting

The Supervisory Board of ÖIAG , the Austrian Republic's investment and privatization agency, has given a green light to the sale to Lufthansa of ÖIAG’s 41.56 percent share in Austrian Airlines . The signing of the contract took place after a meeting of the Supervisory Board of ÖIAG.

The acceptance of the Lufthansa bid is the result of a bidding process launched on August 13, 2008 in accordance with EU privatization guidelines. The process was structured and carried out by ÖIAG and investment bank Merrill Lynch.

Austrian Airlines will remain a broadly independent airline with its head office in Austria, its own brand, fleet and crew, and will be managed as a profit center in the Lufthansa Group. Lufthansa has agreed to maintain Austrian air traffic infrastructure to the greatest possible extent, taking into consideration the needs of Vienna as a business location, as well as continuing to expand this wherever commercially viable in line with the needs of the market. Austrian Airlines will retain a presence in the intercontinental aviation sector with its own long-haul fleet, and contribute its own specific key competence to the Lufthansa Group by continuing to build upon its Focus East strategy. At the same time, however, the consolidation with Lufthansa will also enable Austrian Airlines to develop its presence in European air traffic.

Apart from improved access to international passenger flows and joint international marketing, the benefits for Austrian Airlines will consist of using the cost advantages and economies of scale that will result from integration into the Lufthansa Group. Total synergies on the revenue and costs side are estimated at around EUR 80 million per year.