Deutsche Lufthansa AG intends to provide European Union regulators with a new package of concessions as part of a proposed deal to acquire 41% in Italian national carrier ITA Airways (Italia Trasporto Aereo S.p.A.) for 325 million euros ($348 million). This is reported in a press release Deutsche Lufthansa.
Additional remedies are aimed at addressing the concerns expressed by the EC regarding the proposed transaction, including the issue of organizing certain routes.
The previous proposal provided for the exchange of flight routes with competitors from Rome and Milan airports, as well as the abandonment of eight European routes, including routes from cities in Germany and Switzerland, and limiting the minimum passenger capacity on flights to the United States, Canada and Japan.
Despite the fact that June 6, 2024 is the official deadline for regulatory approval of the deal, it will be extended taking into account the preparation by Lufthansa of a new package of measures.
As part of the agreement signed in the summer of 2023 between Lufthansa and the Italian Ministry of Economy and Finance (Ministero dell'Economia e delle Finanze, MEF), the company will initially buy 41% of the shares of ITA Airways from the Italian government with the right to subsequently acquire the remaining part of the shares. The deal is the latest attempt to revive the Italian airline, which officially ceased operations in 2021.
The deal is in line with Lufthansa's strategy to expand operations in the aviation market, taking into account Italy's advantageous geographical location and the level of economic development. ITA Airways will become the fifth network carrier in the structure of the Lufthansa Group, but will retain independent status and will gain access to the partner network, centralized revenue management and the use of global sales and marketing channels of the Lufthansa Group.
In order to ensure the sustainable growth of ITA, Lufthansa Group in February 2022 signed a memorandum of understanding with the Italian state-owned railway company Ferrovie dello Stato Italiane S.p.A. to expand intermodal transport, which will allow passengers to be transported by rail to the corresponding flights at various airports in Italy and back.
The Lufthansa Group implements similar intermodal cooperation programs in its domestic markets, including Deutsche Bahn, the Austrian OVB and the Swiss Federal Railways.
ITA Airways is the successor company to the bankrupt Italian flagship Alitalia, headquartered in Rome. The company was founded in November 2020. ITA Airways serves more than 10 million passengers per year and has a modern fleet of 66 Airbus aircraft. ITA currently serves 64 destinations, including 21 domestic, 33 international and 10 intercontinental routes.
Lufthansa is the national airline of Germany and the largest aviation concern in Europe, including Swiss International Airlines and Austrian Airlines. The headquarters are located in Frankfurt am Main, and the main hubs are at the airports of Frankfurt, Munich and Dusseldorf.
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