LufthansaDavis
On September 16, a fourth bidder emerged for the company. The German airline Deutsche Lufthansa AG and the California investor Marvin Davis jointly offered to buy or place $100 million of common stock and $300 million of debt in Continental Holdings, matching the previous offer by Air Canada/Air Partners. Davis had recently tried (unsuccessfully) to acquire two other major airlines, Northwest and United. Lufthansa was one of the leading European carriers with $9 billion in annual revenues and had a reputation for providing superior service and reliability. It was also 51 percent owned by the German government. In 1991 it was the world's eleventh-largest airline ranked by total revenue passenger miles. Lufthansa's interest in Continental reflected a growing interest among European carriers in gaining a foothold in the U.S. market. For example, British Airways was currently exploring a possible alliance with USAir, and KLM Royal Dutch Airlines had recently acquired a major stake in NWA, the parent of Northwest Airlines. Lufthansa's 49 percent share of the $100 million in equity would be paid for in surplus aircraft from its own fleet rather than cash. As with the competing offers by MAXAIR and Air Canada/Air Partners, at least $150 million of the new debt would be secured by the assets of Continental Holdings' Air Micronesia division.
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