Recently, the European Commission gave the green light to Lufthansa Group’s proposed acquisition of Italian flag carrier ITA Airways. This deal, announced in May 2023, will result in Lufthansa Group obtaining an initial 41% stake in ITA Airways for 325 million euros, with the option to acquire the remaining shares starting in 2025. The approval from EU antitrust regulators follows a thorough investigation and the agreement of concessions made by Lufthansa and the Italian government.
The concerns surrounding the acquisition included the potential for increased flight prices or a reduction in the quality of airline services to and from Italy. However, European Commission executive vice president Margrethe Vestager stated that the remedies proposed by Lufthansa and the Italian Ministry of Economy and Finance fully address these competition concerns. The deal ensures that there will be sufficient competitive pressure on all relevant routes, benefiting consumers and maintaining a competitive market.
Lufthansa CEO Carsten Spohr highlighted that the EU’s approval sends a clear signal for the strength of air traffic in Europe, enabling it to compete effectively on a global scale. With plans for a swift integration of ITA Airways and its 5,000 employees into the Lufthansa Group, this acquisition will add another hub at Rome Fiumicino Airport, enhancing the route networks through codesharing. ITA Airways will also become a part of the group’s Miles & More loyalty program, providing access to the group’s resources for aircraft and fuel purchasing.
Lufthansa Group emphasized that the acquisition of ITA Airways will improve competition in Italy, especially in the face of dominant low-cost airlines. The transaction is expected to be finalized in the fourth quarter of 2024, pending approval from competition authorities outside the EU. In parallel, the EU Commission is also investigating other acquisitions in the aviation industry, such as British Airways owner IAG’s bid for Air Europa and Air France KLM’s offer for a stake in Scandinavian Airlines (SAS).
Overall, the approval of Lufthansa Group’s acquisition of ITA Airways marks a significant milestone in the aviation industry, with potential benefits for consumers, competition, and the integration of airlines within the European market.