Lufthansa Eyes Concessions For Brussels Approval

Lufthansa could offer the European Commission concessions to gain approval of its takeover of smaller rival Brussels Airlines in a deal worth up to EUR250 million euros (USD$325.4 million).

The company was in talks over concessions on routes between Germany and Belgium, Lufthansa management board member Stefan Lauer said at an anti-trust conference in Hamburg on Tuesday.

"We need to discuss how to ensure competition on these routes in the future," he said. The Commission had already said in January the proposed takeover would create a monopoly on flights between Brussels and Frankfurt, Hamburg and Munich, and substantially reduce competition from Brussels to Berlin.

The acquisition of Brussels Airlines, which carried 5.5 million passengers in 2008, will allow Lufthansa to expand its network and add premium passengers. Lufthansa's passenger numbers totaled 70.5 million in 2008.

Lauer said on Tuesday Lufthansa aimed to complete talks with the Commission before the anti-trust review's July 1 deadline. The European Commission earlier said it has extended its anti-trust review of Lufthansa's plans to buy Belgium's Brussels Airlines to July 1 from June 10 due to commitments aimed at remedying concerns that the deal may be anti-competitive.

European airlines have stepped up the pace of alliances and mergers as they battle a global economic downturn even as fuel prices are retreating from record highs.

Lufthansa at the end of last year signed a deal to acquire loss-making Austrian Airlines and increased its stake in UK airline bmi to a majority.

Source: Airwise