German low-fare airline DBA said Friday it had agreed to take over rival Germania Express in a deal that will transform it into the third-biggest airline in Germany after Lufthansa and Air Berlin.
Gexx now belongs to DBA
DBA said in a statement that it would take over the 12 aircraft and 15 routes of Germania Express (Gexx) with effect from March 28 and the Gexx brand would disappear altogether.
"Taking over most of the Gexx routes and planes is a unique chance to make our strategy a success," Gexx owner Hinrich Bischoff said. "Together we are a power in the market."
Financial details were not disclosed, but the takeover would take the form of a so-called "wet-lease", whereby Gexx employees would remain on the books of Gexx's parent company Germania but would be leased out to DBA. That would ensure that there would be no job losses as a result of the takeover, DBA said.
DBA, currently the second-biggest operator of domestic routes within Germany after Lufthansa, said the deal would increase the number of its inner-German routes to 15 from 11 previously. And the number of its international routes would be increased from six to 17.
Added to DBA's aircraft fleet, which currently consists of 15 Boeing 737s, would be Gexx's 12 Fokker 100 jets. DBA would also see the number of its daily flights increased from 125 to 180 and passenger numbers would rise from three million to four million each year.
Back in black
dba owner Hans-Rudolf Wöhrl
DBA owner Hans Rudolf Wöhrl said the merger would enable his airline to fly back into the black for the first time in its history. "I believe that we'll not only be able to break even, but to book our first real profit in our company's history," he said.
DBA, a former unit of British Airways, was acquired by Wöhrl in 2003 for a symbolic price of one euro. It hopes to post a profit in the current year ending March, after 12 years of losses. Gexx was set up in June 2003 and operates routes both in Germany and Europe. At the end of first full year of business to end-October 2003, it transported some 1.4 million passengers and booked a small profit on sales of €130 million ($169 million).
DBA has also confirmed a newspaper report that Wöhrl had made an offer to buy Greek airline Olympic Airlines. The corresponding information contained in business daily Handelsblatt was correct, a DBA spokeswoman said. The offer had been made by Wöhrl's own holding company, Intro, she added.
Handelsblatt said a total of seven candidates had lined up to take part in the privatization of the struggling Greek airline. Private Greek rival Aegean Airlines has already made its interest known. And press reports suggest that Britania Aviation Services, Olympic Investors and Chrysler Aviation are also interested.
Handelsblatt said investment bank Lazard, which is in charge of the privatization, had closed the bidding last Friday and would draw up a short list of candidates in the coming days. Athens relaunched the privatization of Olympic Airlines in December, after earlier efforts by the previous socialist government had failed.