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Air Berlin plans 100m euro LTU savings
Air Berlin plans to cut costs at LTU by up to 100 million euros after finally receiving approval to take over the airline.
Cost savings of between 70 million to 100 million euros at LTU have been identified from 2008 and beyond.
Air Berlin announced its intention to buy LTU in March and issued a capital increase and a convertible bond offering. The carrier also offered to pay 200 million euros for LTU’s existing debts.
CEO Joachim Hunold could scarcely hide his disappointment at the length of time the 140 million euro deal has taken to win approval by Germany’s Federal Cartel Office.
“We finally got the strategic decision that we hoped for,” he said. “Nevertheless, it is regrettable that this process took so long.
“Therefore, synergies could not be exploited during this year as planned. We were not able to adjust summer flight time tables of both airlines.”
Addressing the planned savings, Hunold added: “Whether we can achieve this, is depending essentially on the outcome of a collective agreement, which is negotiated with LTU pilots as we speak.”
LTU operates 27 aircraft and employs almost 2,800 staff. Last year the company had a turnover of 1.06 million euros and carried 5.7 million passengers.
After the completed takeover, LTU will remain a legally independent company.
by Phil Davies
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