Industry

EU Commission gives “green light” for Lufthansa Group’s participation in ITA Airways

The competition authority of the European Commission has approved the planned acquisition of 41 percent of Deutsche Lufthansa AG in ITA Airways, subject to conditions. Transaction to be completed in the 4th quarter of 2024, after which a swift integration into the Lufthansa Group is planned.

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Lufthansa Group, the Italian Ministry of Economy and Finance (MEF) and ITA Airways have expressly welcomed the EU Commission’s approval under competition law. With this clearance of the competition authority, the way is now clear for the acquisition of a minority stake of 41 percent in ITA Airways (Italia Trasporto Aereo S.p.A.) and the subsequent acquisition of the remaining shares by Deutsche Lufthansa AG for a capital contribution of 325 million euros, which was already agreed in May 2023. The investment will be completed through a capital increase. The transaction is expected to close in the fourth quarter of 2024. This requires both the prior implementation of the remedies negotiated with the EU Commission and the approval of other competition authorities outside the EU. Options for the acquisition of the remaining shares in ITA Airways have been agreed between Lufthansa Group and MEF and can be exercised from 2025 at the earliest.

Following the closing, ITA Airways is to become the 5th network airline to be closely integrated with Lufthansa Group while keeping its brand name ITA Airways. As part of the multi-hub, multi-airline and multi-brand system successfully established by the Lufthansa Group, the Italian airline will utilize numerous synergies, for example in world-wide sales, the loyalty program Miles & More or also in aircraft and fuel purchasing.

This will strengthen and further develop the economic situation of ITA Airways. Italy will become the Lufthansa Group’s fifth “home market”. It will then be the Lufthansa Group’s second largest market in terms of revenue after Germany and the USA. Italy is already the second most important market for the company outside its home markets after the USA. In terms of gross domestic product, Italy is the third largest economy in Europe with a strongly export-oriented economy and one of the most popular vacation destinations worldwide.

Lufthansa Group and ITA Airways are jointly planning a swift integration ITA Airways with its almost 5,000 employees will make the corporate culture of the Lufthansa Group even more international and diverse. Rome-Fiumicino will become the Lufthansa Group’s sixth and geographically southernmost hub. Last year, the airport was awarded with five Skytrax stars.

Immediately after the closing, the route networks are to be linked with each other through code sharing so that customers can combine the airlines’ offers. This will create over 1,000 new transfer options, creating many more options to destinations in South America, North Africa and the Middle East in particular. ITA Airways will also strengthen competition in Italy, which is currently characterized by a superior position of low-cost airlines.