16 September 2008

Eurosharks - The Germano-Austro-Russo-Siberian Connection

So thanks to the other Professor Alex for this one. There are two and I will need to figure out a way to differentiate them. They are for the record both German!

So it seems that what is going on in Austria is far from a simple battle within our industry. it almost reads like an international spy novel. Take the explosive mix of the mega EuroShark Carriers (LH, AF-KL and BA) and the minnow S7 all in a fight for the carcass of Austrian Airlines. We know what is going on with the big chaps but if we scratch the surface we see that the "minnow" is not so small. It may actually be a great white in disguise. Read on...

Let's just ignore the hilarious attempt at participation by THY Turkish "oops not on time" Airlines who found out they did not have time to mount a serious effort to buy the Austrian carrier. Next time chaps call those nice people at T2Impact - they are very good at this sort of thing!

But S7 does appear to be serious. They have been running ads in the local Vienna papers extolling the benefits of the S7 deal and alluding to the fact that they have lots of energy cash to slosh around. Actually I have been impressed with the chaps at S7, they are not your average CIS carrier. Couple that with the fact that on their payroll they have a very interesting lobbyist.

So you thought the Germano-Austrian part was for LH. Not so my dear friends. This is in reference to the (said) powerful lobbyist one Mr Gerhard Schroeder. He is the chap who is engaged to fight for the inclusion in the party of S7 in the deal with the Austrian Government for their shares in Austrian Airlines. Still with me?

Hmmm but what about the Russo part? Well guess who Mr Schroeder's real employer is? It turns out to be Gazprom OAO, THE Russian Energy Company. Gazprom has a strong investment in S7. Of course most people were somewhat surprised when Schroeder left office and then announced he was going to work for Gazprom. He definitely caused a lot of consternation when he left the leadership of one of the west's largest democracies and headed to work for one of Mr Putin's friends.

I present for your further reading pleasure an article on the switch from none other than the Washington Post.


So this sounds like a bit of a soap opera. The Austrians must on the one hand be very happy that they are going to off load their national airline to another poor sucker and that a bidding war has broken out but on the other they had better be careful what they wish for... it might just happen.



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