UA Fan

And expands the partnership to include LOT itself.

Seattlenerd

Reuters is now reporting that both companies, LOT and Condor, have confirmed that LOT will acquire Condor.

Sources say the sale was for 300 million Euros or US $333 million. The bridge loan from the German government will be paid back in its entirety. The deal is expected to close by April 2020.

Perhaps notable for the Alaska Airlines relationship, the article says Condor will continue to operate under its current management.

A318neo

In the long run, Condor may leave as an AS Mileage Plan partner or LOT may join. Still guessing.

scubadu

That really doesn't mean anything. It's incredibly boilerplate language in a transaction like this. Even if that is their current intent, it could be changed at anytime.

Regards

rustykettel

Or remain status quo. Cathay Dragon is still not an AS partner.

sfozrhfco

Yeah, there are still many hurdles to overcome. The Polish Aviation Group is a state owned entity with little/no experience in running a non Polish subsidiary. It seems like it was done more for the Polish nationalist government to prove they could take over a Western European airline/company after years of having Polish assets taken over by Western Europeans, rather than for sound financial reasons. Time will tell if the investment proves to be a good one and if the new owners are able to figure out a strategy for running two airlines successfully. Partnerships seem pretty low on the list of things to figure out in the immediate future.

Seattlenerd

Agreed. I was citing the news story on the "continue to operate under current management" part. However, sometimes there are immediate changes announced in management structure and that has not been the case here. Not yet.

It's been my experience in acquisitions that when the buyer says nothing will change, that is generally true for the first six months while the acquirer fully understands what it bought. After that, all bets are off.

scubadu

Agreed and well stated.

Regards

91foxbody

I just booked LAS - FRA in late December of this year. Here's to hoping Condor is still operational at that point!

jiburi

So great to hear that the condor is able to survive intact rather than liquidation of its former 49% owner. I anticipate some change in operation synergies in the coming month but I think LOT Airlines will take a hard look and see how it can fit and complement it's future as a German segment of its company profile.

Itll be interesting to see how Condor/LOT works out its partnership with Lufthansa as Condor is a direct LCC competitor at Lufthansa's hub in Frankfurt and Munich airport but still needing some connectivity for beyond frankfurt and Munich flying.

As for partnership arrangements with Alaska, I think partnership will continue as long as Condor remain non-member of StarAlliance. With that said, we all know that Lufthansa and LOT polish airlines are both full Staralliance member airlines. As United is the Staralliance member in the States, Condor/Alaska's partnership likely cant continue with AS providing redundancies of Staralliance flights.

.....and I doubt LOT will or can join Alaska knowing United is in their Staralliance profile.

Jiburi

rustykettel

SQ is also Star Alliance, yet they became an AS partner. Unless UA has an ownership stake in LOT and/or management control, just being in Star Alliance shouldn't stop a side partnership directly. Any feed agreement they have with UA (I don't think they have a JV, unlike LH and UA) might influence that though.

TPJ

Small correction - this is PGL (LOT parent company) that buys DE...

LH does everything possible to keep LO out of these 3 mega JV's that have (TATL with UA/AC; China with CA; Japan with NH). LO already flies daily from WAW to LAX and is launching 4 x weekly WAW-SFO this summer. They also try to be creative with BJS - serving both airports - Capital (PEK) and Daxing (PKX) - but this is not that relevant here...

As they are outside of the TATL cartel (ooops - JV) they have friendly relations with AA (AMR was LOT's partner in early 90's) and B6. If I were an AS Marketing person, I would definitely call LO to discuss opportunities for AS to feed the LAX/SFO flights and other stuff that many or may not include FF relationship.

eponymous_coward

Yeah, I don't think it's a lock that AS and LO join up, but AS is definitely hurting for EU-based partners, and if LO's parents are feeling like they need to break away a bit from *A and LH choking off their growth avenues by JVs..I hadn't considered that a M&M airline would be able to break away much, but...

CZBB

I'd expect Iberia long before LOT joins up with AS

eponymous_coward

Perhaps, though LO and IB are fairly analogous; their ownership (PGL/IAG) has a subsidiary (DE or BA/EI) with a relationship with AS, the airline without a relationship is in an alliance (LO/*A or IB/OW). Neither IB or LO serve AS's primary markets yet (SEA/PDX), BA/EI and DE do serve them (and presumably like the feed AS can offer to/from secondary markets).

The curious part is what's DE strategy going forward- they're flying older 767s on longhaul routes that will eventually need replacement, LO's fleet is 787/737-based and being crippled by the problems with the 737 MAX grounding and 787 Rolls-Royce engines.