December 4, 2017 / 11:18 AM / 2 years ago

Exclusive: EU set to approve easyJet purchase of parts of Air Berlin - sources

BRUSSELS/LONDON (Reuters) - British budget airline easyJet (EZJ.L) is set to win unconditional EU antitrust approval to buy parts of failed German peer Air Berlin AB1.DE, people familiar with the matter said on Monday.

FILE PHOTO: An EasyJet passenger aircraft makes its final approach for landing at Gatwick Airport in southern England, Britain, October 9, 2016. REUTERS/Toby Melville/File Photo

EasyJet will take on some of Air Berlin’s operations at Tegel airport in the German capital for around 40 million euros ($47 million). It will also take on leases for up to 25 A320 aircraft, and about 1,000 of Air Berlin’s pilots and cabin crew.

The move will allow easyJet to further bolster its position in Berlin, pulling far ahead of Ireland’s Ryanair (RYA.I) and Lufthansa Group in the German capital.

The European Commission, which is scheduled to decide on the deal by Dec. 12, declined to comment.

Air Berlin was the largest carrier in Berlin before its insolvency, followed by the combined Lufthansa Group airlines, Ryanair and easyJet. German flag carrier Lufthansa has traditionally not focused on Berlin, instead doing most of its flying out of hubs in Frankfurt and Munich.

Lufthansa’s budget unit Eurowings plans to expand rapidly should Lufthansa’s plans to buy Air Berlin units Niki and LGW receive antitrust approval. It has offered concessions to allay concerns it could become too dominant on German and Austrian domestic routes and the Commission is currently seeking feedback from others on the proposed concessions.

Passenger numbers at Berlin’s Tegel and Schoenefeld airports rose by a combined 11.4 percent last year to almost 33 million thanks to booming tourism demand.

Should the deals be approved, easyJet will become the largest carrier in Berlin with 16 million seats, ahead of 10.7 million for the Lufthansa Group (including Eurowings, plus the LGW and Niki seats) and Ryanair on 5.9 million, according to presentation slides from easyJet last month.

But it is not yet clear how much Lufthansa and Eurowings will be able to expand in the capital and elsewhere. Lufthansa Chief Executive Carsten Spohr said on Monday the group was willing to take over Niki with virtually no slots if it meant getting EU approval for the deal.

EasyJet has previously said if it gets approval it expects to start operations from Tegel in January, at first leasing crewed planes while the Air Berlin crews and planes enter its fleet.

Ryanair is also keen to expand in Berlin though, having previously criticized Lufthansa’s purchase of Air Berlin assets as a “stitch-up”. On Friday it said it was also seeking slots in the capital in order to base nine new aircraft at Tegel in a challenge to both easyJet and Lufthansa.

Writing by Victoria Bryan; Editing by Julia Fioretti/Mark Potter/Susan Fenton

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