Lufthansa has offered concessions to ease EU concerns about its plan to buy Air Berlin assets, aiming to avert a collapse of the deal that could unravel the insolvent carrier's carve-up.
The European Commission, which is concerned about Lufthansa's potential dominance in Germany as a result of the plan, said it had extended its deadline for a decision on the deal to December 21 from December 7.
Air Berlin filed for insolvency in August and was subsequently carved up, with Lufthansa buying Niki and LG Walter plus some short-haul planes, for €210m to expand its Eurowings budget brand.
EasyJet is taking on some Air Berlin operations at Berlin's Tegel airport.
However, the Lufthansa deal has come under fire from airlines and consumer groups who fear it will give Germany's flagship carrier dominance of German domestic routes and in Austria.
The EU Commission did not provide details of Lufthansa's proposal, but it had previously determined that Lufthansa, Niki and LGW's activities overlap on over 100 routes, which means that remedies would have to be significant.
A source familiar with the matter told Reuters yesteday that the airline was willing to cede slots belonging to Air Berlin businesses Niki and LGW.
If the EU launches an in-depth probe of the deal, pushing any approval well into 2018, the whole transaction could be called off as Lufthansa has said its financial planning only anticipated pumping money into the ex-Air Berlin flight operations until the end of this year.
That also calls into question whether and how the German government will be repaid a €150m loan it granted to Air Berlin when the carrier filed for insolvency, to prevent its planes from immediately being grounded.
"Of course we still expect that the loan will be repaid," a spokesman for the German economy ministry said today.
It is also unclear whether Austria's government would still stand ready to provide bridge loans to Austrian unit Niki if necessary, following parliamentary elections in October that are set to bring a change in government.
Former motor racing driver Niki Lauda, who founded the Niki business, and Thomas Cook's airline Condor had offered around €100m to buy Niki plus 17 aircraft.
Aer Lingus and British Airways owner IAG had also made a bid for the unit.
Both Thomas Cook and IAG have declined to comment on whether they are still interested in Niki.