Lufthansa, Germany’s national carrier, is considering a buyout and takeover of the Scandinavian Airline System. Reuters reports that unnamed sources close to the both airlines say that the deal is likely. SAS has run into financial difficulties in recent years, and has approached Lufthansa to propose a takeover of the Scandinavian carrier. Rising fuel costs and decreased ridership are causing the airline to have to both raise their prices and lower their level of service. Despite taking measures to curb the rising costs, SAS is still losing market share to other transportation companies both domestically and abroad. The deal was proposed in May, but the specifics remain unclear. “Whether this results in an agreements is still an open question,” one source told Reuters.

Scandinavian Airline System stock rose sharply immediately after the news. Stock prices jumped by more than 6 percent after the public announcement of the possible takeover. SAS has issued an official statement to the press regarding the takeover. “Regarding today’s speculations in the media SAS confirms that it is in the process of evaluating various structural possibilities for the Group. Within this process SAS is conducting talks about a possible structural solution. It must be emphasized that no decision has been taken.” While no name was given on the press release, it came directly from SAS itself. Unfortunately, more detailed descriptions of the possible joining are scarce, and top officials at both airlines are keeping relatively silent, choosing to disclose their information slowly and by widespread press release rather than an in-depth personal interview.

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