International Airlines Group (IAG), the owner of British Airways, is set to acquire the assets of Austrian leisure carrier Niki for €20 million (USD$24 million) and provide liquidity of up to €16.5 million. The purchase, which will be made by a new subsidiary of IAG’s Spanish low-cost carrier Vueling, is subject to regulatory approval by the European Commission.

The Niki assets in question include up to 15 Airbus A320-family aircraft and slots at airports including Vienna, Dusseldorf, Munich, Palma, and Zurich.

The new subsidiary, which, at the time of writing, hasn’t been officially named, will be incorporated in Austria and will operate separately from Vueling initially. The new carrier will hire 740 former Niki employees to run the operation. IAG says that further details of the new carrier’s branding and route network will be “announced in due course.”

“Niki was the most financially viable part of Air Berlin and its focus on leisure travel means it’s a great fit with Vueling,” states IAG chief executive Willie Walsh. “This deal will enable Vueling to increase its presence in Austria, Germany, and Switzerland and provide the region’s consumers with more choice of low-cost air travel.”

“Niki is getting a financially strong partner with a long-term development concept,” said Lucas Floether, Niki’s insolvency administrator. The deal should close in February, he said.

IAG had to beat out other potential bidders for the airline, including Niki Lauda, the former Formula One champion who founded the airline. Three bidders, including Thomas Cook, SilverArrow Capital, and Lauda, all dropped their bids before December 28, 2017.

Niki, a subsidiary of the insolvent AirBerlin, filed for insolvency on December 13, 2017 after Lufthansa dropped its plan to acquire the airline. Founded in 2003 by Niki Lauda, Niki originally flew to several tourist destinations in Spain, Portugal, and North Africa from Vienna.

Featured image from Flickr

Categories: Industry Talk