Niki saved by IAG -full details of what it means

International Airlines Group (IAG), parent company of British Airways, Aer Lingus, Iberia and Vueling, is adding NIKI to its brands after signing a deal to buy the Austrian carrier for €20 million ($24 million) with the bankruptcy administrators.

IAG CEO Willie Walsh confirmed the deal late on Friday, after IAG was left the as the only viable bidder for NIKI, which went into insolvency after its parent airline, AirBerlin, collapsed in October.

The Austrian carrier, founded by former F1 racing driver Niki Lauda, declared bankruptcy on December 13th, after Lufthansa withdrew its offer following the EU telling the airline it couldn’t go ahead, because of its dominance in the area, and lack of any viable competition.

IAG has bought the companies assets, which include up to 15 Airbus A320-family aircraft and a raft of valuable slots at airports including Vienna, Düsseldorf, Munich, Palma and Zurich.

IAG will provide liquidity to NIKI of up to €16.5 million to allow it to resume operations.

The way this is actually being operated is a little different for IAG. Niki is now legally owned by the Groups Vueling subsidiary. They have created a new Vueling owned company that will manage Niki.

No indication on branding or marketing has been discussed yet but keeping the name does seem to matter. Austria and Germany are sensitive to Brands they like and the Niki name carries weight in Austria.

The company will initially at least, trade and operate independently under Vueling’s aegis.

740 former NIKI employees of the 1,000 who lost their jobs will be retained to run the operation. NIKI operated a leased fleet of around 20 Airbus A321s and seven wet-leased TUIfly Boeing 737s.

Willie Walsh of IAG said that, “NIKI was the most financially viable part of AirBerlin and its focus on leisure travel means it’s a great fit with Vueling. 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”.