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Air Berlin gets cash boost with Niki sale to Etihad

German carrier Air Berlin's aircraft is pictured at Tegel airport in Berlin, Germany, September 29, 2016. REUTERS/Axel Schmidt/File Photo

BERLIN (Reuters) - Air Berlin received another cash boost from shareholder Etihad, announcing plans to sell its share of Austria-based carrier Niki as part of a wide-ranging restructuring that will see the creation of a new leisure airline. Selling its 49.8 percent indirect stake in Niki will bring loss-making Air Berlin 300 million euros (252.23 million pound) and have a positive effect on its financial results, the German carrier said in a statement on Monday. Etihad bought a 29 percent stake in Air Berlin in early 2012, hoping to use it to boost its European network. But Air Berlin has made a net loss in almost every year since 2008, posting a profit in 2012 only thanks to the sale of its frequent flyer programme to Etihad for 185 million euros. Air Berlin, which has this year been hit hard by increased competition on routes to tourist destinations in the western Mediterranean, now plans to focus more on long-haul flying in a bid to stem the losses. It is also leasing 40 planes and crew to Lufthansa unit Eurowings. It said on Monday that Niki would take over its routes to tourist destinations such as the Canary Islands, North Africa and Turkey from the 2017 summer flight schedule. Etihad will place Niki into a new leisure airline to be formed with Europe's largest tour operator TUI . The new leisure airline, approved by TUI's supervisory board last month, will be 24.8 percent owned by TUI, 25 percent by Etihad and the remaining 50.2 percent will be controlled by the Austrian Niki Privatstiftung foundation. "With this transaction we are simplifying our business model, reducing out dependence on seasonal destinations and improving our financial situation," Air Berlin CEO Stefan Pichler said. The Air Berlin restructuring comes as Etihad also battles to turn around Alitalia, another of its European investments. The Italian carrier is considering cutting up to 2,000 jobs and may ground planes, sources have told Reuters. (Reporting by Victoria Bryan; Editing by Edward Taylor and Maria Sheahan)