Identifier
Created
Classification
Origin
09VIENNA949
2009-07-29 13:54:00
UNCLASSIFIED
Embassy Vienna
Cable title:
Austrian Air-Lufthansa Deal Looking Up
how-toVZCZCXRO9280 RR RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV RUEHSL RUEHSR DE RUEHVI #0949 2101354 ZNR UUUUU ZZH R 291354Z JUL 09 FM AMEMBASSY VIENNA TO RUEHC/SECSTATE WASHDC 3080 INFO RULSDMK/DEPT OF TRANSPORTATION WASHDC RUCNMEM/EU MEMBER STATES
UNCLAS VIENNA 000949
SIPDIS
STATE FOR EB/TRA AND EUR/CE
PARIS FOR FAA
BRUSSELS FOR FAA
BERLIN FOR TSA (RANDOL)
E.O. 12958: N/A
TAGS: EAIR ECON PGOV AU
SUBJECT: Austrian Air-Lufthansa Deal Looking Up
REF: (A) VIENNA 0910; (B) VIENNA 0585; (C) VIENNA 0225
UNCLAS VIENNA 000949
SIPDIS
STATE FOR EB/TRA AND EUR/CE
PARIS FOR FAA
BRUSSELS FOR FAA
BERLIN FOR TSA (RANDOL)
E.O. 12958: N/A
TAGS: EAIR ECON PGOV AU
SUBJECT: Austrian Air-Lufthansa Deal Looking Up
REF: (A) VIENNA 0910; (B) VIENNA 0585; (C) VIENNA 0225
1. Lufthansa's amended July 28 offer for Austrian Airlines (AUA) has
raised hopes of a successful deal. Although the Commission has
refused to comment specifically on the new offer, Austrian press
reports indicate that Lufthansa has agreed to reduce the number of
flights to Frankfurt in return for keeping its Vienna-Munich flight
options and that AUA will renounce its 22.5 percent share in the
Ukraine International Airlines. Lufthansa was able to make further
concessions because it had secured additional cost savings from
Austrian's unions as reported in ref A. Lufthansa has requested the
Austrian takeover commission to extend the initial July 31 deadline
to August 31 to allow the Commission time to test market the new
offer.
2. Most Austrian stakeholders in the negotiations, including Finance
Minister Josef Proell, the Government Holding Company OIAG, and the
two AUA chairmen of the board (Peter Malanik and Andreas Bierwirth)
are counting on a successful closure of the deal after the latest
developments. They said that "extensive negotiations" had taken
place over the last weekend. Proell said he hoped this move would
"close the circle" as the Austrian government agreed to privatize
AUA exactly one year ago.
3. During August, EU Commissioner Kroess' office will draft a
report addressing the antitrust concerns of Lufthansa's competitors
(especially the critical FlyNiki opposition),and send the report to
the EU "Advisory Committee" for adoption. Simultaneously,
Transportation Commissioner Tajani will report on the legality of
the Austria's 500 million euro state aid to AUA. The EU Commission
is expected to make its final decision in the last week of August or
beginning of September.
HOH
SIPDIS
STATE FOR EB/TRA AND EUR/CE
PARIS FOR FAA
BRUSSELS FOR FAA
BERLIN FOR TSA (RANDOL)
E.O. 12958: N/A
TAGS: EAIR ECON PGOV AU
SUBJECT: Austrian Air-Lufthansa Deal Looking Up
REF: (A) VIENNA 0910; (B) VIENNA 0585; (C) VIENNA 0225
1. Lufthansa's amended July 28 offer for Austrian Airlines (AUA) has
raised hopes of a successful deal. Although the Commission has
refused to comment specifically on the new offer, Austrian press
reports indicate that Lufthansa has agreed to reduce the number of
flights to Frankfurt in return for keeping its Vienna-Munich flight
options and that AUA will renounce its 22.5 percent share in the
Ukraine International Airlines. Lufthansa was able to make further
concessions because it had secured additional cost savings from
Austrian's unions as reported in ref A. Lufthansa has requested the
Austrian takeover commission to extend the initial July 31 deadline
to August 31 to allow the Commission time to test market the new
offer.
2. Most Austrian stakeholders in the negotiations, including Finance
Minister Josef Proell, the Government Holding Company OIAG, and the
two AUA chairmen of the board (Peter Malanik and Andreas Bierwirth)
are counting on a successful closure of the deal after the latest
developments. They said that "extensive negotiations" had taken
place over the last weekend. Proell said he hoped this move would
"close the circle" as the Austrian government agreed to privatize
AUA exactly one year ago.
3. During August, EU Commissioner Kroess' office will draft a
report addressing the antitrust concerns of Lufthansa's competitors
(especially the critical FlyNiki opposition),and send the report to
the EU "Advisory Committee" for adoption. Simultaneously,
Transportation Commissioner Tajani will report on the legality of
the Austria's 500 million euro state aid to AUA. The EU Commission
is expected to make its final decision in the last week of August or
beginning of September.
HOH