Etihad to launch leisure airline JV

Top Stories

Etihad to launch leisure airline JV
Some of the partner airlines in the Etihad Aviation Group.

Dubai - Etihad to acquire the 49.8 per cent share indirectly held by airberlin in its subsidiary airline NIKI Luftfahrt for $321 million

by

Issac John

  • Follow us on
  • google-news
  • whatsapp
  • telegram

Published: Mon 5 Dec 2016, 7:00 PM

Last updated: Mon 5 Dec 2016, 9:15 PM

The Etihad Aviation Group and TUI AG, Europe's largest tour operator, plan to launch a joint venture leisure airline group with a fleet of around 60 aircraft.
The plan includes an agreement for EAG's subsidiary Etihad Investment Holding Company (Etihad) to acquire the 49.8 per cent share indirectly held by airberlin in its subsidiary airline NIKI Luftfahrt for $321 million.
Etihad bought a 29 per cent stake in airberlin in early 2012, hoping to use it to boost its European network
The new leisure airline group will be offering 15 million seats capacity per year, focused on point-to-point flying to connect key European tourist markets, Etihad said.
The joint venture, approved by TUI's supervisory board last month, will be 24.8 per cent owned by TUI, 25 per cent by Etihad and the remaining 50.2 per cent will be controlled by the Austrian Niki Privatstiftung foundation. The transaction is subject to approvals by aviation regulatory bodies and anti-trust authorities.
While Etihad will contribute its share in NIKI to the new European leisure airline group and will not effectively control, TUI will contribute its subsidiary TUIfly GmbH to the joint venture, including the 14 aircraft currently operated by TUIfly for airberlin under a wet-lease agreement.
The new leisure airline group, headquartered in Vienna, is scheduled to begin operations in April 2017, the start of the summer season, serving a broad network of destinations from Germany, Austria and Switzerland (Hanover, Berlin, Düsseldorf, Cologne, Frankfurt, Stuttgart, Munich, Nuremberg, Baden-Baden, Hamburg, Basel and Vienna). Key markets will include the Balearics, Canaries, mainland Spain and Greece, Etihad said.
The joint venture will be supported by the expertise of Etihad Aviation Group, the fastest-growing aviation group in the world, and TUI Group, the world's leading tourism business with a strong focus on hotels and cruises. It will be able to leverage synergies and economies of scale accessible through Etihad Airways Partners and the TUI Group to ensure a lean overhead structure and competitive production cost.
Airberlin CEO Stefan Pichler said with the transaction of NIKI stake the loss-making airline is simplifying its business model, reducing out dependence on seasonal destinations and improving financial situation.
The Air Berlin restructuring comes as Etihad also battles to turn around Alitalia, another of its European investments. The Italian carrier is considering cutting up to 2,000 jobs and may ground planes.
- issacjohn@khaleejtimes.com
 
 
 


More news from