Lufthansa bid for NorwegianBack to Forum
Just been announced that Lufthansa are in talks to buy Norwegian.
Wonder what Willie Walsh will think of that !!!!18 Jun 2018
According to this Blooomberg article – Norwegian Air Gains as Lufthansa CEO Says He’s Mulling Bid …
Willie Walsh said on May 18 that the Nordic carrier wasn’t a must-have target and that no developments were likely anytime soon.
Or, as Norwegians might say, “Kjekt å ha”.19 Jun 2018
a bidding war for Norwegian or should IAG give up and lodge a cheeky bid to take KLM off the disaster that is AF
Unlikely as AF would have to be a willing seller, and (unfortunately) they won’t sell as it’s the one part that actually makes money.19 Jun 2018
In the light of Lufthansa’s interest in Norwegian some points need to be considered.
The Bloomberg chart used on the shareprice clearly indicates that the underlying value given to Norwegian, by the markets, is in the region of 180 kroner. After IAG’s interest was revealed the price shot up to about 250 kroner. Fromm there it has climbed further but has been gradually falling again to 240 kroner. Lufthansa’s interest has pushed up the price to 280 kroner,at least. Analysts have calculated that the company can go for up to 320 kroner / this seems a tad expensive for me.
The crunch will come in the autumn – as it already has for Monarch, Air Berlin and Alitalia – when the results for the spring and summer quarters are known. Norwegian has to make substantial operating profits in those periods for it to have a half chance of surviving or selling itself off at a high price. The prospects of high oil prices and intensive capital investment in new aircraft could still push the company into the arms of a white knight.
So what is happening. I think that Norwegian CEO, Bjorn Kjos, wants to talk up the price to ensure Norwegian sells out at a high price.On the other hand Lufthansa’s CEO, Carsten Spohr is playing the spoilers’ game knowing that Eurowings has few synergies to gain from merging withg Norwegian but wants to make the purchase expensive for IAG. Wille Walsh, CEO of IAG, knows that a waiting game is to his advantage especially with regard to the European/British competition-antimonopoly authorities when the ripe fruit could fall into his lap.
We will see.19 Jun 2018
Germany’s Handelsblatt reckons it “could be a costly flirt for Lufthansa.”19 Jun 2018
Thanks Alex,Handelsblatt puts it well and quotes LH ceo,it maybe too much for LH in terms of a different operation with different aircraft and particularly anti- trust.
LH is in alliance with SAS ofcourse using many of the same bases as Norwegian and a direct competitor on EU routes. While IAG competes too it operates similar aircraft, is smaller than LH so consolidation with Norwegian would make it more competitive not less so as LH.
It increases the share price and cost for IAG ‘though not a practical operation for LH and likely they’d just close it down so very anti-trust!20 Jun 2018
As others have alluded to , this really annoys me, in fact it really ****** me off
I was very impressed with Norwegian when I flew them earlier in the year, and would now be my first choice on certain routes, so I need to ask…….
Why oh’ why are old established dominant ,usually ex state funded or supported airlines allowed to prey on independent new comers before they have a chance to become strong enough to resist what in most cases are hostile takeovers?
I know that the airline industry is full of dinosaurs with associated behaviours , but I thought the EU had legislation in place to stop predatory practice that ultimately reduces consumer choice ?
I can understand consolidation of 2 weak carriers, but this just reeks of removing a competitor —In fact Freddie Laker’s ghost should haunt Willie Welsh and Carsten Spohr in equal measure !!21 Jun 2018
Yes ofcourse, however it is free trade in an EU thats open to business within certain rules and while LH may well have reasons to stifle Norwegian, IAG doesn’t need to do that except where it may reduce its trans atlantic alliance.
IAG can use DY to expand its Level business, a different market to the alliances IAG has now.
IAG has little market from northern EU except its transfers via LHR and Finnair alliance and DY can expand its business with better finance?
Reduced or no expansion from the London area until further RWYs are built (maybe never?) means a take over of DY by IAG can expand both using alternative routes and markets and BA can use its hub with larger aircraft in the limited slots it has available.23 Jun 2018