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German leisure carriers Air Berlin and TUIfly are in advanced merger negotiations, industry sources said yesterday.

The two carriers are understood to be undergoing due diligence by external auditors at this moment. Details of the planned combination ” which is likely to take place under the Air Berlin roof ” have yet to emerge and neither company is prepared to comment officially.

The sudden turn of events comes after separate and exclusive talks to combine TUIfly, Lufthansa affiliate Germanwings and Thomas Cook’s leisure carrier, Condor, failed. A merger of the three carriers would have created a third large German airline roughly equivalent in size to Air Berlin, but with financially powerful shareholders Lufthansa, TUI and Thomas Cook. The combination would also have taken the three airlines off their parents’ balance sheets, a move the three groups have been trying to accomplish for several years.

source: Aviation Week

Germany’s leisure airline sector could be set for a major consolidation with Germanwings, Eurowings and TUIfly discussing a merger. If completed, the deal would create a group with a combined fleet of more than 100 aircraft and a network of about 185 destinations.

TUI Travel confirms it has signed a memorandum of understanding with Lufthansa and Eurowings majority shareholder Albrecht Knauf concerning the merger, but little else has been revealed.

The airlines will be brought together under a joint independent holding company in the proposed deal, but the companies stress that the process is at an “‘early stage'” and there is “‘no guarantee'” it will lead to an integrated airline group.

fuente: flightglobal.com

TUI Travel now has the UK’s third largest airline, with 80 aircraft, and has 23 more on order for 2009.

TUI Travel chief executive Peter Long is currently managing a 100-day review of the entire business and is due to reveal his strategy for the future business at the end of January next year.

source: travelweekly.co.uk

Lufthansa’s Germanwings airline and TUIfly are in talks about an alliance that could include a merger, sources familiar with the matter said on Wednesday.

The sources said talks were at an early stage, adding that Germanwings would seek operational control in any alliance with TUIfly.

Lufthansa, TUI and Germanwings declined to comment.

Travel giant TUI Travel , which is 51 percent owned by TUI, said in September it could sell TUIfly. TUI Travel is conducting a strategic review and is to detail its decisions by January.

source: Yahoo!

Travel giant Tui Travel could dump its TUIfly.com low-cost airline brand, the firm’s finance director said on Wednesday.”‘The simple answer is yes it is being reviewed (TUIfly branding),'” Paul Bowtell told analysts and reporters.

“‘I think it’s clear for all to see that that decision, together with incremental capacity in that source market in 2007, hasn’t been successful,'” he added.

The firm is currently in the middle of a strategic review and is to detail it decisions by January.

source: Reuters

TUI AG’s TUIfly unit said it ‘will not tolerate a possible monopoly’ following a code-sharing agreement between Condor, Air Berlin and LTU.

TUIfly spokesman Herbert Euler said ”the code-sharing agreement between TUIfly and Air Berlin was under review anyway” and added that such an agreement between Condor, Air Berlin and LTU would need approval by the cartel office.

source: ABC Money