Legal concerns over Russian carrier S7's bid for Austrian Airlines
20 Sep 2008
Russian carrier S7's attempt to circumvent European regulations in its bid to take over troubled carrier Austrian Airlines might not succeed, according to a report in an Austrian magazine Format.
According to the report, if S7 gains direct majority ownership of Austrian Airlines its European flight licence would be withdrawn on account of its status as a non-European Union carrier. S7 has tried to circumvent this problem by submitting a plan that would seek take control of Austrian Airlines through a private trust to be established, and based, in Austria.
The Austrian state's adviser in the deal, Merrill Lynch, has, however, expressed legal concerns over such a scheme.
Along with some other carriers, S7 is seeking to take over 42.75 per cent stake in the airline, currently being offloaded by the Austrian state.
