Commission approves the restructuring of Austrian Airlines

Published: 28 August 2009 y., Friday

Lėktuvas
The Commission has today decided to close the formal investigation procedure into the privatisation and restructuring of Austrian Airlines concluding that the restructuring following its sale to Lufthansa is compatible with community law. The Commission has concluded that the price to be paid by Lufthansa involves State aid but that such aid is compatible in accordance with the Community framework for rescue and restructuring of firms in difficulty.

European Commission Vice-President and Commissioner for Transport Antonio Tajani said "This decision is yet another step taken favouring the consolidation of the airline sector. It will lead to a market that is undistorted by state aid, with an ultimate benefit for passengers."

Following a privatisation procedure Lufthansa has been selected to buy the Austrian State's stake (41.56%) in Austrian Airlines. The other shareholders (free floating and institutional) will also be bought out by Lufthansa. The price to be paid is made up of three elements:

Lufthansa will pay a purchase price of € 366.268,75

the State receives a debtor warrant, which may lead to an additional payment

Lufthansa has requested that Austria recapitalise Austrian Airlines with EUR 500 million to compensate for Austrian Airlines' high level of historical debt. Without the State recapitalisation Lufthansa will not buy Austrian Airlines.

Having opened an investigation into the sale and the restructuring plan 1 and having examined the evidence provided by Austria and the observations received from over 40 interested parties, the Commission has reached the conclusion that the (negative) price paid by Lufthansa for Austrian Airlines reflects the value of the enterprise at the time it was being sold. However, as bankruptcy would have been a cheaper option for the State the decision of Austria to accept a negative price amounted to a grant of State aid.

The Commission has therefore examined the restructuring plan submitted by the Austrian authorities and has concluded that this plan is in conformity with the applicable Community rules. The aid is kept to a minimum and a reduction in capacity combined with a cap on growth will be sufficient to address any competitive concerns raised by the acquisition. The capacity of Austrian airlines will be reduced by 15% from its January 2008 level by the end of 2010. Thereafter Austrian Airlines' growth will be capped at the average of the growth rate observed for member airlines of the Association of European Airlines. Such cap will remain in place until end 2015 or until Austrian Airlines reaches an operational break even, whichever comes first. Austrian Airlines will also reduce its shareholding in Schedule Coordination Austria GmbH to 25%.

 

Šaltinis: europa.eu
Copying, publishing, announcing any information from the News.lt portal without written permission of News.lt editorial office is prohibited.

Facebook Comments

New comment


Captcha

Associated articles

The most popular articles

MEPs secure overhaul of EU financial regulation

The financial and economic crisis has shown that reckless behaviour of banks and other financial institutions can have serious and costly consequences for Europe's economy and its people. more »

MEPs back unspent money for local energy & transport investment

Local services that create jobs and improve energy efficiency received a boost Thursday (2 September) when MEPs on the Industry, Research and Energy Committee approved plans for more investment. more »

The European Union approves EUR 264 million to help 19 African, Caribbean and Pacific States face the consequences of the economic crisis

The European Commission approved the first financing decisions under the EUR 264 million 2010 allocation for the so-called Vulnerability FLEX mechanism to help the most vulnerable African, Caribbean and Pacific countries cope with the impact of the global financial crisis and economic downturn. more »

Commission adds two Ghanaian airlines to the EU list of air carriers subject to an operating ban

The European Commission has today updated the list of airlines banned in the European Union to impose an operating ban on one air carrier from Ghana and to place operating restrictions on another air carrier from that country. more »

€7.5 million of EU funds to help 951 former workers in marine manufacturing in Denmark find new jobs

The European Commission today approved an application from Denmark for assistance under the European Globalisation adjustment Fund (EGF). more »

Commissioner Šemeta visits China to boost cooperation in custom controls and tackling counterfeit goods

Algirdas Šemeta, EU Commissioner for Taxation, Customs Union, Anti-Fraud and Audit, will open tomorrow an international conference at the Shanghai World Expo 2010 on building bridges to facilitate trade between China and the EU. more »

€90 million EU grant to crisis-hit Moldova approved by EP Trade Committee

Moldova is set to receive an EU grant of up to €90 million to help it through the financial crisis, following a vote at Parliament's Committee on International Trade on Monday. more »

August 2010: Business Climate Indicator for the euro area remains broadly unchanged

Important notice: since May 2010 business surveys data are classified in accordance with an updated version of the Nomenclature of Economic Activities (NACE rev. 2) causing a potential break in series at this date. more »

Spring 2010 Eurobarometer: EU citizens favour stronger European economic governance

75% of Europeans think that stronger coordination of economic and financial policies among EU Member States would be effective in fighting the economic crisis, according to the Spring 2010 Eurobarometer, the bi-annual opinion poll organised by the EU. more »

State aid: Commission extends the Slovenian bank liquidity support scheme

The European Commission has extended until the end of the year the liquidity support scheme for banks in Slovenia. more »