Last week was a busy one for European airlines. One pending M&A deal got regulatory approval and another cooled off a bit. Meanwhile, one of the largest airline groups in the region is still hunting for new leadership.
Surprise Q2 Profit Dims Norwegian Acquisition Speculation
Norwegian Air Shuttle surprised investors by reporting a second-quarter profit of 300 million Norwegian krone (about US$37 million), compared with a loss of 690 million krone a year prior. The low-cost carrier's revenue rose 32 percent year over year, and the U.S. has become its strongest market outside of Norway. While Norwegian remains in a precarious financial position—it faces high costs from over-fleeting and rising fuel prices, according to Bloomberg—the positive financial news gives weight to founder and CEO Bjorn Kjos' desire to remain an independent carrier. International Airlines Group—parent of British Airways, Iberia and Aer Lingus—already has acquired a small stake in Norwegian and has indicated it might be interested in a full takeover, and Lufthansa chief executive Carsten Spohr more recently has indicated he might be interested in bidding for the carrier.
Ryanair Acquisition Gets EU Green Light
On July 12, the European Commission approved Ryanair's acquisition of Laudamotion, a new airline created from the assets of Airberlin leisure airline Niki after founder Niki Lauda reacquired them. The commission ruled that the acquisition raises no competition concerns. With the approval, Ryanair can raise its stake in Laudamotion from 24.9 percent to 75 percent—Lauda will continue to own the other 25 percent—and plans to keep Laudamotion as its own brand.
Air France-KLM CEO Search Continues
Air-France-KLM expects to name a new CEO within the next few weeks and have a new leadership team in place by September, according to a Reuters report that cites an internal Air-France-KLM memo. Chairman and CEO Jean-Marc Janaillac resigned in May after Air France staff rejected a multi-year pay agreement; the pay dispute has prompted strikes that have hit the carriers' finances significantly. The memo also indicated that AccorHotels' publicized interest in a minority stake in Air France-KLM has slowed the CEO search, according to Reuters.