Lufthansa Offer For Austrian To Run Until May 11

February 27, 2009

Lufthansa has formally submitted its takeover offer for Austrian Airlines at the announced price of 4.49 euros per share, with a May 11 deadline for acceptance, Lufthansa said on Friday.

The acceptance period runs from March 2.

European airlines including Air France-KLM and British Airways are seeking tie-ups to better weather the economic downturn and slumping demand.

In December, Lufthansa signed a deal to buy the loss-making Austrian carrier, expecting the move to make it Europe's biggest airline.

Under the deal, Lufthansa agreed to buy Austrian state holding company OeIAG's 42 percent stake in AUA and take over the airline completely for up to EUR377 million euros (USD$479 million).

The transaction, which needs European Commission approval, also involves the Austrian state assuming around EUR500 million of Austrian Airlines debt.

The European Commission has said it had doubts on whether the amount of aid had been kept to a minimum and whether Austria's restructuring plan would restore AUA's long-term viability without the need for more funds in the future.