After months of review and concessions to assure competition, the European Union’s competition regulators have signed off on the Italian government’s sale of 41% of its wholly-owned ITA Airways to Lufthansa.
Conditions imposed on the sale include giving up a portion of ITA’s domestic business to other operators, possibly including EasyJet and Volotea, as well as making it possible for new carriers to compete in long-haul flights from Italy.
The €350 million deal will allow Lufthansa to add ITA, successor to bankrupt Alitalia, to Lufthansa Group’s operations, which also include Brussels Airlines, Swiss Airlines, Austrian Airlines, Eurowings and a few others. The deal gives Lufthansa the right to buy the remaining 59% as early as next year.
Once the deal closes, later this year, ITA will move its alliance membership from SkyTeam to Star Alliance, of which Lufthansa is one of the key members. ITA will also join the Lufthansa Group’s Miles and More loyalty program.
Like Lufthansa’s other airlines, it will continue to operate as a separate unit with its own identity. While nothing has been said about a possible name change, ITA did buy Alitalia’s trademarks and intellectual property at a bankruptcy sale.
International Airlines Group, parent of British Airways, Iberia, Aer Lingus and Vueling, applauded the approval; it is waiting on EU approval for its acquisition of Air Europa, and is one of the potential bidders, along with Lufthansa and Air France/KLM for Portugal’s TAP.