Lufthansa shares are trading higher Thursday, following news the European Commission has approved its purchase of insolvent Air Berlin’s LGW subsidiary. The deal will see 33 new planes added to Lufthansa’s Eurowings fleet.
By 1410 BST, Lufthansa shares were trading 0.70% higher at €31.00. The Lufthansa share prices has climbed steadily throughout the year, after beginning 2017 at €12.27.
The European Commission approved Lufthansa’s purchase of LGW earlier Thursday. However, it did attach some conditions to the deal, which Lufthansa has moved to meet.
“Our job is to make sure that mergers do not make European consumers worse off,” said Commissioner Margrethe Vestager, in charge of competition policy. “Lufthansa has put forward improved remedies that make sure the effects of its LGW acquisition on competition are limited.”
“In particular, at Düsseldorf airport, Lufthansa's slot portfolio would only increase by 1% – half of all the slots would be held by Lufthansa's competitors. This addresses our competition concerns, so we approved the proposed acquisition today under EU merger rules,” Vestager said in a statement.
Lufthansa also withdrew from a possible purchase of Austrian airline NIKI Luftfahrt GmbH, or “Niki” in order to ensure the LGW purchase would gain approval.
Lufthansa welcomes decision
The Lufthansa Board was unsurprisingly pleased with the European Commission’s decision.
“This regulatory approval of our acquisition of LGW is an encouraging development,” said Thorsten Dirks, a Member of the Lufthansa Group Executive Board and CEO of Eurowings, on the Lufthansa Group website.
The approval of Lufthansa’s purchase of LGW follows recent hiring activity by Eurowings. Over 500 new staff, including pilots and attendants have been hired by the airline in the past few weeks.
There is also a collective expansion agreement in place with all the relevant unions.
“We have the support of our social partners, we are an attractive employer, we have and will be getting more first-rate employees – with these conditions, Eurowings will continue to be a growth engine in 2018” Dirks said.