Air Berlin (AB, Berlin Tegel) creditors have decided to go ahead with a lawsuit against Etihad Airways(EY, Abu Dhabi Int’l) for withdrawing financial support to the German carrier in August 2017 despite earlier assurances, Reuters has reported.
The carrier’s administrators have reportedly been already asked by the creditors to find a firm which could finance the planned litigation.
The lawsuit could call for more than EUR1 billion (USD1.24 billion) in compensation from the Emirati carrier. This money would then be used to repay the bankrupt airline’s creditors, including the German state, suppliers, and passengers.
Etihad Airways, which has owned 29.2% of Air Berlin’s stake since 2011, sent a comfort letter saying it would continue to financially support the German carrier for at least a further 18 months in April 2017. Despite that, in August, the Emirate group withdrew its backing, causing Air Berlin to imminently declare insolvency. Thanks to a EUR150 million bridge loan from the German state-owned KfW bank, Air Berlin continued to operate until the end of October 2017.
Despite the sale of Air Berlin’s major airline assets to Lufthansa Group, easyJet, LaudaMotion (OE, Vienna) and a Zeitfracht/Nayak consortium, the bankrupt carrier has so far raised capital only sufficient to meet a small part of its overall commitments.