Air Berlin files for bankruptcy protection

Air Berlin files for bankruptcy protection

German carrier Air Berlin filed for administration today following repeated restructuring efforts and months of deepening difficulty.

Lufthansa confirmed it is in talks with Air Berlin to take over parts of the group. The airline will continue flying while protected from creditors.

In a statement, Lufthansa said the German government was also supporting Air Berlin’s restructuring.

It reported: “Air Berlin filed a provisional insolvency proceeding in self-administration at the local court of Berlin-Charlottenburg today.

“Lufthansa is supporting the restructuring efforts of the airline jointly with the German government.

“This ensures that all aircraft currently operated by Air Berlin under a wet lease agreement for [Lufthansa Group subsidiaries] Eurowings and Austrian Airlines will continue operating as before.

“Lufthansa is in negotiations to take-over parts of the Air Berlin Group and exploring the possibility of hiring additional staff.”

The administration filing follows the collapse in June of separate negotiations between the Tui Group and Air Berlin-stakeholder Etihad on a deal to set up a joint-owned leisure carrier combining the fleets of Tui’s German carrier TuiFly and Air Berlin.

Etihad owns a near 30% stake in Air Berlin. It described Air Berlin’s filing for administration as “extremely disappointing, especially as Etihad has provided extensive support to Air Berlin for its previous liquidity challenges and restructuring efforts over the past six years”.

The Abu Dhabi-based group noted: “In April this year, Etihad provided €250 million of additional funding to Air Berlin as well as supporting the airline to explore strategic options for the business.”

It said: “Air Berlin’s business has deteriorated at an unprecedented pace, preventing it from overcoming its significant challenges and from implementing alternative strategic solutions.

“Under these circumstances, Etihad cannot offer funding that would further increase our financial exposure.”

More:

Etihad Airways reports $1.9bn loss

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