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Lufthansa to buy SN Brussels

The European Union has given Lufthansa, the German national carrier, the green light to purchase SN Brussels, after it was agreed the merger would not create a monopoly over some of Europe’s most lucrative routes. It is not clear how much money Lufthansa is offering, although it is expected to take up a 45% stake in SN Brussels in a month. Lufthansa will also have an option of buying the remaining 55% shares in 2011, according to a press statement from SN Brussels.
Offering its position on the issue of monopoly over the routes, the EU noted that Lufthansa had given “an efficient and timely slot mechanism” on how it will operate in the region, according to a press statement from SN Brussels. The disputed routes include Brussels-Hamburg, Brussels-Zurich, Brussels-Frankfurt, and Brussels-Munich. Neelie Kroes, the EU Competition Commissioner, who allowed the deal to go through said the deal was in the best interest of consumers.

"The comprehensive remedies package offered by Lufthansa will facilitate market entry on the affected routes and thereby create alternative choices for passengers," she said. In Kampala, Roger Wamara, SN Brussels marketing manager, welcomed the deal, saying it makes the company “part of a global family.” Lufthansa had no direct flights to Entebbe. The merger means that SN Brussels joins the Star Alliance, the largest airline alliance. Under such an alliance, the passengers will be able to fly to more than 1000 destinations. Wamara said that being part of such a strong alliance also gives SN Brussels the leverage to cut down on ticket prices should the need arise.

Wamara said that, unlike many mergers, no job layoffs are expected to occur in Uganda. “As far as Uganda is concerned, we do not expect such drastic changes.”
SN Brussels, which flies to more than 50 destinations, was formed in 2005 after the collapse of SABENA.

jeff@observer.ug

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