Major German air carrier files for insolvency

Lufthansa said it was supporting Air Berlin's restructuring efforts

"Lufthansa is supporting the restructuring efforts of the airline jointly with the German Government", LHG said in a statement on its website.

German Economy Ministry said several airlines have already shown interest in purchasing the assets of one of Germany's biggest airlines Air Berlin.

But Ryanair called this move an "obvious conspiracy" between the German government, Lufthansa and Air Berlin to "carve up Air Berlin's assets, while excluding major competitors and ignoring both European Union competition and state aid rules".

CEO Thomas Winkelmann on Wednesday blamed the delay in opening the new Berlin global airport for Air Berlin's failure-it was supposed to open in 2011 and still has no clear opening day.

After that the airline's future is uncertain.

Meanwhile, Lufthansa said it was in talks to take over parts of airberlin's business, a Reuters report said. Winkelmann said the talks were "very well advanced".

Air Berlin had to choose the bankruptcy route as its businesses deteriorated in a fast pace.

"Our priority now lies with securing the jobs", said Christine Behle, a union board director.

Air Berlin filed for insolvency in a local court of Berlin, though it announced it would not file bankruptcy protections for the Leisure Cargo GmbH and Niki Luftfahrt GmbH units. After six years, Etihad realized their efforts weren't going to help the company, and made a decision to pull the plug on future financing. At the time, those included Etihad and its airport services subsidiary, Air Berlin, Alitalia, Air Serbia and Air Seychelles Ltd.

It noted that it had granted ample financial aid to the carrier over the past six years, with Air Berlin receiving another 250 million euros ($293 million) in April to keep afloat.

Ryanair airline recently complained to the Bundeskartellampt about a deal under which Lufthansa subsidiaries Eurowings and Austrian airlines hired Air Berlin craft and crew to fly routes for them.

Air Berlin's insolvency came after its main shareholder, Etihad, stated it would not give further financial support to the German carrier.



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