International Airlines Group (IAG), parent company of British Airways, Aer Lingus, Iberia and Vueling, is adding NIKI to its portfolio after sealing a deal to acquire the Austrian carrier for €20 million ($24 million).

IAG CEO Willie Walsh confirmed the deal Dec. 29 after IAG was left the sole remaining bidder for NIKI, which went into insolvency after its parent airline, airberlin, ceased operations in October this year. The Austrian carrier, founded by former racing driver Niki Lauda, filed for bankruptcy Dec. 13 after Lufthansa withdrew its offer. The European Commission (EC) had expressed competition concerns about Lufthansa’s bid.

A statement from IAG, released mid-evening Vienna time, Friday, said the multi-national company would pay for the assets, which include up to 15 Airbus A320-family aircraft and what IAG described as “an attractive slot portfolio” at airports including Vienna, Düsseldorf, Munich, Palma and Zurich.

Additionally, IAG will provide liquidity to NIKI of up to €16.5 million.

The transaction is being made by a newly-formed subsidiary of Spanish LCC Vueling, one of IAG’s airlines. The new subsidiary will be incorporated as an Austrian company and run initially as a separate operation. The deal is subject to customary closing conditions, including the EC approving the move.

It was the EC’s reluctance to allow Lufthansa to take over NIKI on competition grounds that led to the German flag-carrier withdrawing from the deal, triggering NIKI’s bankruptcy.

The new company aims to employ around 740 former NIKI employees to run the operation. NIKI operated a leased fleet of around 20 Airbus A321s and seven wet-leased TUIfly Boeing 737s. The airline has 1,000 staff.

“NIKI was the most financially viable part of airberlin and its focus on leisure travel means it’s a great fit with Vueling,” Walsh said. “This deal will enable Vueling to increase its presence in Austria, Germany and Switzerland and provide the region’s consumers with more choice of low-cost air travel”.

Further details about the new subsidiary’s branding and route network will be provided at a later date, said IAG.

Alan Dron alandron@adepteditorial.com 

Kurt Hofmann hofmann.aviation@netway.at