Sunday 24 June 2018

airberlin ...filing for administration.

Etihad terms airberlin insolvency move 'disappointing'

ABU DHABI, August 15, 2017

Abu Dhabi-based Etihad Airways has termed German airline airberlin’s filing for administration as extremely disappointing. Etihad is a minority shareholder in airberlin.

The struggling German airline filed for insolvency earlier today after years of losses caught up with it and  Etihad withdrew funding, a report said.

“We have been informed that airberlin has filed for administration.  This development is extremely disappointing for all parties, especially as Etihad has provided extensive support to airberlin for its previous liquidity challenges and restructuring efforts over the past six years,” Etihad said in a statement.

“In April this year, Etihad provided EUR 250 million of additional funding to airberlin as well as supporting the airline to explore strategic options for the business. However, airberlin’s business has deteriorated at an unprecedented pace, preventing it from overcoming its significant challenges and from implementing alternative strategic solutions,” it said.

“Under these circumstances, as a minority shareholder, Etihad cannot offer funding that would further increase our financial exposure. We remain open to helping find a commercially viable solution for all parties,” the Etihad statement said.

“We expect airberlin operations to continue during administration. We have a commercial relationship with airberlin across a range of areas, including codeshare operations, and we will support airberlin’s management during these difficult times.

“Germany is an important market for Etihad and Abu Dhabi, and we remain committed to providing comprehensive air links as a key enabler of trade and tourism,” it added.

Meanwhile, Lufthansa said it was in talks to take over parts of airberlin's business, a Reuters report said.

Funding from Etihad, which bought into the airline in 2011, helped to keep airberlin afloat in recent years, but the Abu Dhabi-based airline has been reviewing its European investments after they failed to bring it the profit it expected, Reuters said.

Air Berlin said its flights were continuing. The German government said it had provided a bridge loan of EUR 150 million. – TradeArabia News Service

Tags: Etihad | administration |

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