The European Commission has given its approval for Lufthansa Group’s proposed acquisition of Italian flag carrier ITA Airways. This acquisition, which was announced in May 2023, will allow Lufthansa Group to acquire an initial 41% stake in ITA Airways for 325 million euros, with options to purchase the remaining shares starting in 2025. The approval came after an investigation by EU antitrust regulators, who were initially concerned about the potential impact of the deal on flight prices and the quality of airline services to and from Italy.
In order to address the competition concerns raised by the European Commission, Lufthansa and the Italian government made several concessions. These included the transfer of slots at Milan Linate Airport to a short-haul competitor, as well as enabling one or two rival airlines to operate nonstop flights between Rome or Milan and certain hubs in Central Europe. These measures were intended to ensure that a sufficient level of competitive pressure remains on all relevant routes.
Lufthansa Group’s CEO, Carsten Spohr, described the EU’s decision as a positive development for air traffic in Europe, noting that it demonstrates Europe’s ability to compete globally. Following the acquisition, ITA Airways will be integrated into the Lufthansa Group, joining other airlines such as Lufthansa, Austrian Airlines, Swiss, Brussels Airlines, and Eurowings. Rome Fiumicino Airport will become the Lufthansa Group’s sixth hub, with route networks being linked through codesharing agreements.
According to Lufthansa Group, the acquisition of ITA Airways will strengthen competition in Italy, where low-cost airlines currently hold a dominant position. ITA Airways will also become part of the group’s Miles & More loyalty program, allowing passengers to earn and redeem miles across all member airlines. Additionally, the Italian carrier will be able to leverage the Lufthansa Group’s capacity for aircraft and fuel purchasing, which could lead to cost savings and operational efficiencies.
The transaction is expected to close in the fourth quarter of 2024, pending approval from competition authorities outside the EU. At the same time, the European Commission is also looking into other proposed acquisitions in the airline industry, including British Airways owner IAG’s bid to acquire Air Europa and Air France KLM’s offer to take a 19.9 percent stake in Scandinavian Airlines (SAS). Overall, the approval of Lufthansa Group’s acquisition of ITA Airways signals a changing landscape in the European airline industry, with increased competition and consolidation shaping the future of air travel.
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