31 JANUARY 2011
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European Commission officials have blocked the proposed merger of Aegean Airlines and Olympic Air on the grounds it would create a quasi-monopoly in the Greek air transport market. The EU says that a merger would lead to higher fares for four out of six million Greek and European consumers travelling on routes to and from Athens each year. On the Greek domestic market the two carriers control 90% of the market. It also points out that at the present time it is unlikely that another airline would enter the market.
Aegean is a member of Star Alliance and from Athens serves Heathrow at Terminal 1. Olympic is owned by Greece’s Marfin Investment Group and at Heathrow uses T4. BA also operates the route from T5, as does easyJet from Gatwick South.
The airlines had offered to cede take-off and landing slots at Greek airports, but Greek airports do not suffer from the congestion observed at other European airports in previous mergers or alliances.
The companies say that they are reviewing the EC decision and following internal consideration and consultation with their advisers will decide for their possible further actions within the framework of existing legislation. www.aegeanair.com www.olympicair.com
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