{"id":74571,"date":"2024-11-12T19:42:40","date_gmt":"2024-11-12T14:12:40","guid":{"rendered":"https:\/\/aviationa2z.com\/?p=74571"},"modified":"2025-01-17T23:51:38","modified_gmt":"2025-01-17T18:21:38","slug":"lufthansa-buys-ita-airways-for-325-million-euros","status":"publish","type":"post","link":"https:\/\/aviationa2z.com\/index.php\/2024\/11\/12\/lufthansa-buys-ita-airways-for-325-million-euros\/","title":{"rendered":"Lufthansa Buys ITA Airways for 325 million Euros"},"content":{"rendered":"\n

COLOGNE-<\/strong> The Italian Ministry of Economy and Finance announced that it has reached an agreement with Germany’s Lufthansa (LH). The deal will allow Lufthansa (LH)<\/a> to acquire a 49% stake<\/strong> in ITA Airways (AZ)<\/a>, Italy’s national airline. <\/p>\n\n\n\n

The sale is expected to be valued at \u20ac325 million.<\/strong> Lufthansa shareholders likely responded to this news with stock price declining by 1.04% on Tuesday morning (November 12, 2024).<\/p>\n\n\n\n

\"Lufthansa
Photo: Airbus<\/figcaption><\/figure>\n\n\n\n

Lufthansa’s Stake in ITA<\/h2>\n\n\n\n

The Italian Ministry of Economy and Finance stated that the European Commission had received all the required documents before the midnight deadline. <\/p>\n\n\n\n

Lufthansa (LH) had previously acquired a 41% stake in ITA Airways (AZ) with an option to increase its ownership to 100% <\/strong>in the future. <\/p>\n\n\n\n

Although Lufthansa reached an agreement with the Italian Ministry of Economy and Finance for this purchase in May 2023, it only obtained the European Commission’s approval earlier this year, in July.<\/p>\n\n\n\n

The subsequent deal with the Italian government for the 49% stake came after months of negotiations and delays, as both parties struggled to reach an agreement regarding the price and terms. <\/p>\n\n\n\n

This was mainly because Lufthansa wanted a \u20ac10 million discount on the price of the 49% stake, which the Italian government did not accept, leading to stalled negotiations. <\/p>\n\n\n\n

Lufthansa revealed that the primary reason for its discount request was ITA Airways’ estimated drop in value in the last quarter of this year.<\/p>\n\n\n\n

There have also been anti-competition concerns regarding this deal, given Lufthansa’s significant presence and operations in Europe. However, Lufthansa has consistently stated that it would prioritize fair competition, especially on its long-haul routes, and not raise prices excessively.<\/p>\n\n\n\n

In a statement received by Euronews<\/em><\/a> over email, a Lufthansa Group spokesperson confirmed the submission of a remedy package to the European Commission. <\/p>\n\n\n\n

This package is intended to fulfill the conditions of the clearance decision regarding Lufthansa’s acquisition of a 41% stake in ITA Airways, which was obtained on July 3, 2024. <\/p>\n\n\n\n

The spokesperson added that the submission was done jointly with the Italian Ministry of Economy and Finance (MEF) in a timely manner on November 11, 2024. <\/p>\n\n\n\n

Lufthansa Group expressed confidence that the EU Commission will approve the remedy package within the upcoming weeks.<\/p>\n\n\n\n

\"ITA
Photo: Eurospot<\/a><\/figcaption><\/figure>\n\n\n\n

Potential Financial Boost<\/h2>\n\n\n\n

The sale of ITA Airways (AZ) could provide a financial boost for the Italian government. The government has been trying to sell the airline for some time, primarily due to its long-term underperformance.<\/p>\n\n\n\n

Lufthansa has significant experience in turning around struggling airlines, with a vast network of subsidiaries such as Brussels Airlines, Eurowings, Discover Airlines, and Swiss International Airlines (SWISS). This expertise could benefit ITA Airways.<\/p>\n\n\n\n

Moreover, Italy has seen a rise in air travel, particularly with budget carriers like Ryanair (FR) and EasyJet (U2). This deal is expected to direct more air traffic to the country.<\/p>\n\n\n\n

Additionally, Lufthansa is anticipated to make an offer for a stake in TAP Air Portugal (TP)<\/a> next year.<\/p>\n\n\n\n

Stay tuned with us. Further, follow us on social media for the latest updates.<\/p>\n\n\n\n

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Lufthansa Group Acquires 41 Percent in ITA Airways<\/a><\/blockquote>