Taking Action O'Leary Calls Lufthansa-Air Berlin Deal a 'Joke'

Ryanair CEO Michael O'Leary is objecting to German authorities on Lufthansa's recent agreement to lease Air Berlin planes, calling the deal a "joke" masked as a takeover.
Michael O'Leary, chief executive of Europe's biggest budget airline.

Europe's largest airline Lufthansa is sealing up the German market with its Air Berlin tie-up, Michael O'Leary, chief executive of Europe's biggest budget airline Ryanair, told Reuters news agency in an interview.

Mr. O'Leary claimed Lufthansa's recent agreement to lease 38 crewed planes from low-cost carrier Air Berlin for six years was a "joke" and a "fig leaf" to mask the acquisition of its main domestic competitor. The deal would raise their combined market share to 63 percent. "It is nothing other than a takeover," O'Leary said.

Ryanair has submitted its concerns to Germany's competition authority. "They have been very receptive," Mr. O'Leary said, adding that the reason behind this was that the deal would lead to the disappearance of airline capacities on domestic routes and that ticket prices would rise. "The cartel rules in Europe are not being enforced fairly," O'Leary told Reuters.

Germany’s Federal Cartel Office said on Wednesday it would make a decision by the end of the month on whether to review the deal. According to one of its speakers, Ryanair was consulted about the deal within the framework of a market survey.