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Thomas Cook merges Condor with Air Berlin

Thomas Cook merges Condor with Air Berlin (Forimmediaterelease.net) 20.09.2007
# Air Berlin to become one of the leading European airlines
# Thomas Cook to receive at least EUR 500 million in shares and cash
# Estimated annual synergies of more than EUR 70 million
# Positive effects on Thomas Cook’s balance sheet and results
# Thomas Cook consequently executes on its Asset Light Strategy

Thomas Cook Group plc will merge its stake in Condor Flugdienst GmbH with Air Berlin PLC. Air Berlin therewith becomes one of the leading European airlines and will with Condor be able to enlarge its long-distance flight business, which it runs since the acquisition of LTU. Thomas Cook Group is consequently executing on its Asset Light-Strategy as promised. Both partners expect positive synergies of at least Eur70 million. Thomas Cook will receive at least EUR 500 million in shares and cash and has the option to gain a total amount of EUR 600 million over the positive share price development of Air Berlin. Through the integration of Condor into Air Berlin Thomas Cook will in addition achieve positive effects on its balance sheet and results. The transaction is subject to the approval by the cartel authorities.

75.1% of Condor Flugdienst Gmbh belong to Thomas Cook Group plc and 24.9 % to Deutsche Lufthansa AG. The agreement about the mutual shareholdings between Air Berlin and Thomas Cook ist still subject to Deutsche Lufthansa AG not asserting a contractual preemption right. The acqusition of 75.1% of Condor by Air Berlin will be completed until February 10, 2009. For the remaining 24.9% Thomas Cook will exercise its call options and afterwards will assign the shares to Air Berlin.

Air Berlin already offers a range of attractive flight connections between hubs like Düsseldorf, Berlin and Mallorca. Through the integration of Condor Air Berlin will be able to increase the attractivesness of its offer at the airports Frankfurt, Munich and Hamburg. In addition Air Berlin has just placed the biggest order in Europe for the currently most modern aircraft model Boeing 787 Dreamliner.

As Manny Fontenla-Novoa, CEO of Thomas Cook’s stated: “The agreement aims at reducing risk and maximizing flexibility. This transaction will create significant value for the shareholders of Thomas Cook and secure the long-term future for Condor. As the biggest shareholder of Air Berlin, we are benefiting from Air Berlin’s extensive flight offer. Together, we have a significant potential for growth. Furthermore, Air Berlin will remain a long-term strategic partner for Thomas Cook and provide us with flight capacities."

Joachim Hunold, Air Berlin’s CEO, explained in Düsseldorf on Thursday: “In light of the quickly progressing concentration process of European aviation, integrating Con-dor into the Air Berlin Group secures the future for both companies. Together, we will achieve international competitiveness. This step makes sense, especially following the takeover of LTU, since it will enable us to offer our clients a more tightly-meshed long-haul flight network."

Ludger Heuberg, CFO of Thomas Cook Group plc, emphasized that exchanging Condor shares for Air Berlin shares will increase profits per share for the sharehold-ers of Thomas Cook: “The participation in the new Air Berlin is worth more than a 100 percent participation in Condor." Thomas Cook plc will consolidate its share in Air Berlin at equity.

Ulf Hüttmeyer, CFO of Air Berlin PLC, said: “Earnings per share for Air Berlin will not decrease through Thomas Cook’s investment in 2009. They will more likely increase through the synergies that we will achieve."

Background information

Founded in 1955, Condor Flugdienst GmbH currently has a fleet of 35 aircraft and transported 7.8 million passengers last year. Sales volume amounted to EUR 1.2 billion. While Condor, like LTU, mainly focused on tour operators and travel agencies for its sales, Air Berlin concentrated on single-seat sales and sales over the Internet. Moreover, Air Berlin already has a high percentage of business travelers. Last year, Air Berlin transported 19.7 million passengers. Sales volume in 2006 amounted to EUR 1.57 billion. At present, the Air Berlin Group operates a fleet of 131 aircraft.

www.airberlin.com

Press contact:
Air Berlin
Peter Hauptvogel
Corporate Communications
phone: +49 30 3434 1500
e-mail: abpresse@airberlin.com

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