Air Berlin, Germany's biggest low-cost has agreed to buy Condor from tour operator Thomas Cook, for as much as 4475 million. Air Berlin will purchase 75.1 percent of Condor from Thomas Cook in February 2009. In return for its stake in Condor, Thomas Cook will receive new Air Berlin stock worth €380 million, as well as about €100 million based on Air Berlin's share performance. It will also receive €120 million. For Thomas Cook, the deal enables them to scale down ina move to reduce risk following its June merger with MyTravel to create TUI Travel.
Thomas Cook chief executive Manny Fontenla-Novoa said the transaction would make Air Berlin the fifth biggest European airline, helping to thwart rumoured takeover attempts by the Irish carrier Ryanair or Air France-KLM. A statement confirmed that the deal will leave Thomas Cook with 29.99% of Air Berlin. Condor is Air Berlin's third major purchase in a year as the carrier seeks to compete with its larger cheap flight rivals Ryanair and EasyJet.
The deal means Condor will add 35 planes to the 131 already operated by Air Berlin. Savings from the combination will amount to at least 70 million euros a year, Air Berlin said. Thomas Cook said the deal should be earnings enhancing in the year through October 2009. MyTravel and Thomas Cook own around 3,000 travel stores and almost 100 aircraft.
