Poland could merge its air travel firms into one holding-paper

WARSAW, Nov 26 (Reuters) - Poland wants to merge its airline industry into a single holding company, which would combine assets the flagship carrier LOT, worth around 2.5 billion euros ($3.38 billion), according to daily Rzeczpospolita.

The holding could then be privatised, with the exception of its infrastructure assets.

"The treasury ministry, in cooperation with the transport ministry, is working on the concept of concentrating air transport companies. An air holding is an option," Treasury Minister Wlodzimierz Karpinski was quoted as saying by the daily.

Merging air travel companies, such as those operating the profitable Warsaw and Krakow airports, into one holding company would help offset losses at its struggling flag carrier LOT.

Warsaw has been seeking ways to keep its carrier LOT flying, and the airline has already received about 200 million euros ($270 million) in state aid.

But the European Commission responded by launching an investigation into whether Poland breached competition rules by helping LOT.

The Commission has investigated aid granted to other national airlines, including Air Baltic, Adria Airways, Estonian Air and SAS (Other OTC: SASDY - news) .

LOT, one of the world's oldest airlines, has struggled to compete with bigger rivals, such as Lufthansa, and low-cost competitors, such as Ryanair.

It had been banking on the acquisition of Dreamliner jets from Boeing (NYSE: BA - news) to improve its fortunes. But those aircraft have been repeatedly grounded due to technical problems, and LOT is seeking compensation from the manufacturer.