DHL Airways chief executive John Dasburg's planned acquisition of 100% of the cargo carrier's shares, including 25% owned by Germany's Deutsche Post, is set to close by 30 June, at which time the airline will rebrand as Astar Air Cargo.

The changes in ownership and name are meant to temper the controversy over whether the North American-based carrier is US-owned and controlled. But DHL is prepared to fight for its US citizenship in the face of a campaign by rivals United Parcel Service (UPS) and FedEx Express, which contend DHL Airways is controlled by Deutsche Post's DHL Worldwide Express.

DHL Worldwide Express is DHL Airways' largest customer and will continue in that role even after a Dasburg-led US group takes full ownership of the carrier.

"UPS and FedEx Express can't say the owners aren't American anymore," says Ray Lutz, DHL Airways business development and strategic planning vice-president. "But they don't intend to let this thing die. This is a competitive issue for them. They have 79% of the US market - the only thing they don't like about 79% is it's not 100%."

At a US Department of Transportation (DoT) hearing last week UPS lawyers said the ownership and name changes do not alter the "underlying factors" in the case, arguing that contractual relationships between DHL Airways and DHL Worldwide Express still give the latter control over the former.

DoT administrative law judge Ronnie Yoder, overseeing hearings on DHL Airways' citizenship status, says proceedings will continue.

Says Yoder: "We're going to look at the totality of the circumstances, which may include… whether contracts between DHL Airways and DHL Worldwide Express and Deutsche Post and their subsidiaries and affiliates give Deutsche Post actual control over DHL Airways."

Source: Flight International