Ryanair chief Michael O’Leary expects Lufthansa to take over Air Berlin without a challenge by regulatory authorities despite the Irish carrier filing complaints to both the EC competition commissioner and the German Bundeskartellamt (cartel office).
Air Berlin went into bankruptcy protection in early August after major shareholder Etihad declined to invest further in the carrier.
O’Leary denounced the process as “a stitch up”, but said: “In a funny way it will be good for us.”
Speaking in London on Thursday, O’Leary said: “Air Berlin will shortly disappear making Ryanair the second largest airline in Germany.
“It went into bankruptcy in the second week of August. That is not a time when airlines run out of money, but it is two months before the German federal election.
“The government is supporting the process with a state aid loan allowing the German number one to buy the German number two.”
The Berlin government has made €150 million in credit available to Air Berlin.
O’Leary said: “Major competitors have been excluded [from the process]. Lufthansa are the only people in discussions with Air Berlin which is run by ex-Lufthansa executive Thomas Winkelmann.
“It will all be locked up by mid-September. I don’t expect the Bundeskartellamt to do anything. It’s a stitch up.”
But he said: “Lufthansa has 47% of the German market and Air Berlin 13%. Ryanair is next with 6%. Even Zimbabwe or North Korea would struggle to justify such a takeover. Germany is breaking all the rules.”
He warned: “German citizens will suffer higher fares. Lufthansa will become a monster.”
But O’Leary added: “Lufthansa will cut routes and increase fares. It will increase our share in Germany.
“We would bid for Air Berlin if it was a fair process. But our angle is to try to embarrass the German government as much as possible.
“The EC will be embarrassed. It has a bad record, but we’ll force the EC competition authorities to impose some remedies on Air Berlin.”