Proposed Olympic/Aegean merger delayed by EU

The merger between Greece’s Aegean Airlines and rival Greek airline Olympic, which is owned by buyout firm Marfin Investment Group, has been delayed until January, pending a decision from the EU’s antitrust authorities. The merger would make the new entity the dominant force in the Greek market, with 64 aircraft and 5,580 employees.

(Reuters) – EU antitrust authorities delayed until January a decision on a proposed merger between Greek carriers Aegean Airlines and privatised rival Olympic [OLY.UL], the EU’s competition chief said on Thursday.

Competition Commissioner Joaquin Almunia gave no specific reason for delaying the decision, which had been expected on Dec. 7.

The Commission typically extends deadlines if companies offer concessions to sooth competition concerns or if the parties to a merger deal ask for more time.

“The big difficulty here is that the two companies hold almost all the domestic market in Greece,” Almunia said in a speech to a competition event held by the Belgian EU presidency.

“As with previous airline cases, we will need to ensure that consolidation in the airline sector does not happen to the detriment of consumers and businesses in Europe.”

The merger would create a dominant carrier in Greece’s domestic market, with a fleet of 64 aircraft and a workforce of 5,850 employees.

Buyout firm Marfin Investment Group acquired Olympic last year, despite a higher Aegean offer, because of Greek government concerns that the EU competition watchdog might block a combined Aegean/Olympic deal.
(Reporting by Foo Yun Chee, editing by Rex Merrifield and Hans Peters)