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Actually, the parent company of the Polish airline Lot should buy the Condor vacation plane. Then the deal broke. It’s getting difficult for the airline.
First came the champagne corks, then came the hangover: The parent company of the Polish airline Lot, PGL, will not take over the German holiday airline Condor. On Easter Monday, PGL had canceled the already agreed acquisition, without giving reasons.
The broken deal is a big problem for Condor. Because by Friday the airline has to pay the state loan of 380 million euros plus interest and abandon the protective shield procedure. In this, the airline was supposed to reorganize after its mother, Thomas Cook, filed for bankruptcy, and thus ran into difficulties.
In repaying the loan, the company had firmly relied on the Poles’ money and therefore had not requested an extension of state aid. The challenges at Condor are now even greater, as noted by aviation expert Cord Schellenberg. “The PGL left the bride after the registration office,” he told t-online.de. Condor could hardly repay its loans without a new buyer.
The condor could be divided into many parts.
The airline itself is combative. At least still. “We are examining how we are going to enforce our claims on the signed purchase contracts,” said a Condor spokeswoman at the request of t-online.de.
But how promising is that? Schellenberg is skeptical, especially since the Polish government now blames German negotiating partners for the failure of the acquisition.
Treasury Secretary Jacek Sasin told private broadcaster RMF on Thursday that Poland would not pay compensation for the withdrawal of the contract, as Condor had requested. The reason: Condor did not adhere to the agreed contractual terms. A Condor spokeswoman rejected the allegations: “Condor has fulfilled the contractual terms for the acquisition by PGL.”
Aviation expert Cord Schellenberg (source: Privat / t-online.de)
How things will continue with Condor is uncertain. It’s not just about paying off the loan, according to expert Schellenberg. It is much more problematic that the future of the entire group is at stake again.
“Condor may not be able to stay as a unit,” Schellenberg said, which means the group is becoming increasingly likely to break up.
Until recently, this was not an option for Condor boss Ralf Teckentrup. In the fall he had assured that the group would not only be sold in parts, but as a whole. “Due to the current situation, this option will be less realistic,” added Schellenberg.
Easyjet and Ryanair could take over the parts
The reason: Many airlines are extremely bad right now. Most of the planes are on the ground due to the corona virus, many trips have been canceled. In such a situation, there would be no investor to take over a company as a whole, not even one that had previously been properly managed. “So far, Condor has been in good shape,” said Schellenberg. “But that changed with the crisis, as with all airlines around the world.”
The aviation expert hopes there will be no “cherry harvest.” This means that Condor will be divided into many small parts.
Instead, it is also possible that short and medium-range routes may be taken by low-cost airlines such as Ryanair or Easyjet. Lufthansa could then take over the long-distance division of the leisure airline or parts of this division.
“Lufthansa is happy when there is one less competitor”
The largest German airline has experimented a lot with vacation flights in recent years, Schellenberg says. With Condor, the group could adopt a concept that previously would have worked well. “Also, Lufthansa is happy when there is one less competitor.”
In any case, Condor has the weakest negotiating position. And that despite the fact that Lufthansa is currently anything but good. The last time it was known that the group is losing around a million euros, and that per hour.
A spokeswoman for the group said in the course of the t-online.de request: “How long we can get over it depends on when the operation can start again.” It was impossible to name a point in time. “It may continue until summer.”
A Condor plane at Frankfurt airport: the airline could be destroyed after the cancellation of PGL. (Source: onemorepicture / imago images)
Aviation expert Schellenberg also does not expect a possible acquisition to occur before Lufthansa returns to normal. Lufthansa says in the t-online.de application that they do not want to comment on such rumors. Condor also does not want to participate in speculation.
Lufthansa could save the state
As uncertain as Condor’s future may be, Lufthansa’s future is secure. According to Schellenberg, there is almost no way to prevent the state from participating in the group. “After the crisis, Germany needs a stable plane that serves many destinations,” he said. That is only possible if the state joins Lufthansa. Lufthansa is already in talks with the state, the company says.
And the condor? Would state participation also be an option here? “That would be a surprise,” says Schellenberg. “After all, Germany does not need a state vacation pilot.”
Temporarily, until there are one or more new buyers, he assumes a state trustee structure. On behalf of the federal government, an administrator would take over the airline’s business without becoming the owner.
