Looks Like Lufthansa Wants to Buy Norwegian, Too

Jun 18, 2018

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Norwegian Air is a hot commodity. After two rejected bids to acquire it from IAG, British Airways’ parent company, now Lufthansa is after the low-cost airline as well.

Norwegian has already rejected two bids from International Airlines Group earlier this year, and now Lufthansa CEO Carsten Spohr says his group is “in contact” with Norwegian about a possible acquisition.

“In Europe, everyone is talking to everyone,” Spohr, who leads the biggest airline group in Europe by passengers carried, told a German newspaper on Monday. “There’s a new wave of consolidation approaching. That means we are also in contact with Norwegian.”

In April, IAG — the parent company of British Airways, Iberia, Aer Lingus and others — announced that it had acquired a 4.61% stake in Norwegian Air, which prompted rumors of a possible complete takeover. But, Norwegian’s board said in May that it had unanimously rejected two bids from IAG.

A third bid from IAG of 1.52 billion euro (~$1.79 billion) to acquire Norwegian was rumored to be in the works near the end of May, but it is unclear if that ever materialized. IAG’s CEO Willie Walsh also said in May the company would not get into a bidding war for Norwegian.

Since IAG acquired its original 4.61% of Norwegian, the low-cost carrier’s CEO said the airline had been approached by several parties interested in an acquisition. “We are happy to have IAG as an investor,” Norwegian CEO Bjørn Kjos said at the time. “Needless to say, they are not the only interested party that has approached us.”

Low-cost carriers across Europe have been struggling as higher fuel prices and labor difficulties put stress on their bottom lines, which is raising the possibility of merging with larger airlines. Norwegian is no exception to these financial struggles. The carrier reported a net loss of €30.8 million in 2017, compared to a €116 million profit in 2016, and it has been forced to lease aircraft from other operators due to ongoing issues with the Rolls-Royce Trent 1000 engines on its Boeing 787s.

Lufthansa’s Spohr told Reuters that as low-cost carriers face financial hardships, the airline group would grab acquisition opportunities as they arose. But so far, Lufthansa is playing its cards close to the vest — it is not exactly clear how interested the German-based aviation behemoth is in a deal for Norwegian.

“Takeovers are always a question of strategic value, the price and anti-trust,” Spohr told the German newspaper. “There are no easy answers.”

Featured image by Francis Dean/Corbis via Getty Images.

Chase Sapphire Preferred® Card

WELCOME OFFER: 80,000 Points

TPG'S BONUS VALUATION*: $1,650

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.