Berlin regrets EU decision on airline Niki as insolvency looms

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BERLIN (Reuters) - The German government said it "greatly regrets" a decision by the European Commission to block Lufthansa's planned purchase of airline Niki and it signalled insolvency for the Air Berlin <AB1.DE> subsidiary and the grounding of its flights.

"Due to the unexpected collapse in proceeds from the sale of Niki, it is possible that only a part of the government guaranteed loan from KfW (bank) to Air Berlin will be repaid," said government spokesman Steffen Seibert in a statement.

"The government will do everything it can to limit the damage to the tax payer," he added.

(Reporting by Thomas Escritt and Madeline Chambers)

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