International Airlines Group to acquire NIKI

International Airlines Group, the parent company of BA, is to acquire certain assets of the Austrian airline NIKI. It will operate as a subsidiary of Barcelona based airline Vueling and will operate from Vienna, Dusseldorf, Munich, Palma and Zurich.

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International Airlines Group - Aer Lingus, BA, Iberia, Vueling
International Airlines Group – Aer Lingus, BA, Iberia, Vueling

International Airlines Group (“IAG”) is to acquire the assets of Austrian airline NIKI.

The airline was formerly part of the Air Berlin group and was due to be acquired by Lufthansa, amongst other assets of Air Berlin. However, Lufthansa withdrew its bid after the European Commission raised competition concerns. NIKI subsequently suspended all of its operations, and they currently remain suspended.

IAG is paying €20m to acquire the airline’s assets which will include to up 15 Airbus A320 aircraft and take off and landing slots at airports such as Vienna, Dusseldorf, Munich, Palma and Zurich. It will also provide €16.5m of liquidity. IAG also plans to recruit up to 740 NIKI employees.

NIKI will operate as a subsidiary of Vueling. Whilst IAG has not explicitly said so, this suggests that it will operate under the Vueling brand name. The transaction will be facilitated by the formation of a new subsidiary in Austria.

Willie Walsh, CEO of International Airlines Group, said:

NIKI was the most economically viable part of Air Berlin and its focus on leisure travel fits in perfectly with Vueling’s strategy, which will allow Vueling to increase its presence in Austria, Germany and Switzerland. and offer consumers in the region many more “low-cost” travel options.

IAG has not provided any further information. To speculate, IAG is likely to want to firm up its route network plans in advance of the summer travel season and may well provide further information when it announces its annual results on Friday 23 February 2018. There is also the possibility that some assets such as airport slots may be used by other airlines in the group, such as BA. As hubs of Vueling (Barcelona, Paris Orly) have been selected as bases of IAG’s nascent low cost long-haul LEVEL, there is also the possibility that NIKI’s bases in Europe may become future bases for LEVEL.

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