Lufthansa, the German carrier, is bracing itself for an imminent antitrust warning from the European Union (EU) regarding its bid for a minority stake in ITA Airways. A reliable source with direct knowledge of the matter revealed that Lufthansa is prepared to offer targeted remedies to address competition concerns.
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The proposed deal involves Lufthansa seeking a 41% stake in the state-owned Italian rival, ITA Airways, for a sum of 325 million euros as part of a capital increase. However, the European Commission has raised concerns that this acquisition could potentially reduce competition in passenger air transport services across various short-haul and long-haul routes.
The EU competition enforcer will also scrutinize whether ITA Airways, Lufthansa, and its joint venture partners—United Airlines and Air Canada—should be treated as a single entity post-merger. Lufthansa anticipates receiving a statement of objections from the Commission in mid-March, outlining specific concerns in greater detail.
To address these concerns, potential remedies may mirror those applied in the Korean Air and Asiana deal. In that case, the Commission cleared the merger only after the involved parties relinquished slots, traffic rights, and planes, allowing a competitor to operate on overlapping routes. During the EU watchdog's preliminary review, Lufthansa had proposed remedies, but these were rejected as they failed to allay regulatory apprehensions. The Commission is expected to make a decision on the deal by June 6.