Takeover of Swiss approved, says Lufthansa

Airline Industry Information, March 23, 2005

AIRLINE INDUSTRY INFORMATION-(C)1997-2005 M2 COMMUNICATIONS LTD

German airline Deutsche Lufthansa AG said on Tuesday (22 March) that its takeover of Swiss International Air Lines had been approved by the boards of both companies and by the Swiss airline's major shareholders.

Under the terms of the planned deal Lufthansa would pay up to EUR310m for Swiss, including up to EUR265m to the major shareholders and about EUR45m to the free-float shareholders, reported Reuters.

Because of air traffic regulations and antitrust rules, Lufthansa would initially put Swiss shares into a new company called Air Trust, of which it would hold 11%, and when antitrust approval is gained the stake would be raised to 49%, said Lufthansa. After aviation regulatory approval is given the German airline's holding would increase to 100%.

The deal was to be signed later on Tuesday, the company said.

The European Union Transport Commissioner said he agreed with a takeover but the final decision would be made by EU competition authorities.

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