BERLIN (Reuters) - Ryanair (I:RYA) plans to buy a stake in new Austrian leisure carrier Laudamotion, helping former motor racing champion Niki Lauda to get the airline up and running and giving the Irish carrier a bigger presence in Germany and Austria.
Ryanair has agreed to buy an initial 24.9 percent stake in Laudamotion, formed out of insolvent carrier Niki which was part of Air Berlin, and plans for that to rise to 75 percent "as soon as possible", subject to EU approval.
The Irish budget carrier will invest less than 50 million euros ($61.7 million), though will provide an additional 50 million euros in funding for start-up and operating costs in the first year.
"This Laudamotion partnership is good news for Austrian and German consumers/visitors who can now look forward to real competition, more choice and lower fares," Ryanair CEO Michael O'Leary said in a statement.
Niki, which flies to tourist destinations from Germany and Austria using A320 planes, was seen as the most attractive part of insolvent Air Berlin.
Germany's largest carrier Lufthansa (DE:LHAG) dropped plans to buy Niki in December over competition concerns.
British Airways parent IAG (L:ICAG) then won a bidding round, before that decision was cancelled over legal action. Lauda eventually won a new bidding process to buy back the airline he founded.
($1 = 0.8102 euros)