Lufthansa pulls the trigger on Brussels Airlines acquisition

Lufthansa announced that it will move forward on its anticipated takeover of Brussels Airlines. A notice from the Lufthansa Group posted yesterday stated that the German carrier planned to acquire the remaining 55 percent of shares it does not already own and wrap up the deal “at the beginning of 2017.”

Lufthansa’s pithy release has raised media and industry speculation regarding the future of the Brussels Airlines brand and its role in the former’s efforts to expand its low-cost airline Eurowings, which is in competition with other low-cost carriers, such as Ryanair.

In 2008, Lufthansa bought 45 percent of SN Holding (Brussels Airlines’ parent company) for €65 million. According to Flanders News, the Belgian carrier has subsequently incurred enough debt to Lufthansa that the deal could go through for as little as €2.6 million.

From the cargo perspective, acquiring Brussels Airlines brings a strong performer fully into the Lufthansa fold. The Belgian carrier’s numbers took a dive following the terrorist attack that struck Brussels Airport earlier this year, however the latest numbers suggest that the worst is in the past.

Fright tonnage for the Belgian carrier increased 26.1 percent, year-over-year, for the month of August, to 2,972 tonnes. The carrier’s freight load factor for August fell 1.5 percentage points, y-o-y, to 56.6 percent.

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