Lufthansa's failure to buy Air Berlin's Austrian arm Niki will likely cost the German government €150m (£133m), a senior member of Angela Merkel's ruling alliance admitted today.
British Airways' owner IAG said on Friday it would buy Niki in a deal worth €36.5m.
The IAG move followed Lufthansa backing out of a €200m takeover of Niki after European authorities indicated they would block the transaction.
Collapsed carrier Air Berlin was extended a €150m loan by the German government as it grappled to stay afloat.
“The damages will be borne by creditors and German taxpayers, who will see nothing of the Air Berlin bridging loan in the amount of €150m,” said Hans Michelbach, the deputy leader of the CSU – the Bavarian sister party of Merkel's Christian Democrats.
Niki filed for bankruptcy earlier in December after Lufthansa dropped its planned takeover.
Michelbach said the situation would have been different if the Lufthansa deal had been given the green light, according to reports by Reuters.
The Bavarian political heavyweight called for a full investigation and claimed details had emerged that appeared to show the European authorities provoked Lufthansa’s withdrawal of its takeover offer for Niki in order to “make possible the takeover by a certain investor at a bargain price.”
IAG said on Friday it plans to save 740 of Niki's 1,000 staff by incorporating Niki into its low-cost operator Vueling.
The European Commission did not respond to a request for comment from Reuters on the claims made by Michelbach.