Lufthansa Interested To Acquire Stake At Austrian Airlines

Frankfurt, Germany (AHN) - Lufthansa announced Monday it is interested in acquiring a stake at Austrian Airlines. The announcement comes amid reports that the German air carrier is also in a partnership deal talk with Alitalia.

Lufthansa did not indicate how much of Austrian Airlines it would purchase. While up to 100 percent of the debt-ridden Austrian air carrier is for sale, 25 percent of Austrian Airlines is expected to be held by Austria either through private investors or by the state-owned holding company OEIAG.

Interested buyers must file their notification of interest until Sunday midnight for at least 42.75 percent share of Austrian Airlines, currently held by OEIAG. There are reportedly five more interested buyers, including Air France/KLM and S7, Russia's second largest airline based in Siberia.

S7 is said to be in favor of keeping AU's hub in Vienna, while Lufthansa plans to relocate it to Munich.

Austrian Airlines has over $1.4 billion (900 million euro) in debts. For the first half of 2008, it incurred a loss of $72.5 million (48.7 million euro), expected to climb up to $134 million (90 million euro) by year end.

Meanwhile, the Italian newspaper La Stampa identified Lufthansa as the foreign partner expected to bail out ailing Alitalia from its financial woes.