Greece : EU says finding some difficulties with planned merger of Olympic & Aegean Airlines

EU regulators are still seeking concessions from Greek carriers Aegean Airlines and Olympic before deciding whether to allow their proposed merger, the EU's competition chief said on Wednesday. The airlines want to merge to better compete with foreign rivals, but the combined carrier would dominate Greece's domestic market, with a fleet of 64 aircraft and a workforce of 5,850. The European Commission, which launched an in-depth investigation into the bid in July, has until Jan. 12 to decide on the plan.   

"We are finding some difficulties. We are in contact with the parties. We still have time to find an adequate solution. We are preparing our final decision in close contact with the parties in finding an adequate solution," Competition Commissioner Joaquin Almunia told a news conference. He said the case had similarities to Irish airline Ryanair's  takeover bid for rival Aer Lingus in 2007, which was blocked because of concerns it would create a monopoly.   

The regulator had then cited inadequate concessions offered by Ryanair to soothe its worries. Carriers typically give up airport slots or provide access to their frequent flyer programmes, among others, to secure approval. "If we cannot find a solution that will avoid competition problems, we will react accordingly," Almunia said.   

Buyout firm Marfin Investment Group bought Olympic last year, despite a higher Aegean offer, because of Greek government concerns that the EU competition watchdog might block a combined Aegean-Olympic deal.

News source: Balkans.com link: article