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Lufthansa back in the race for Alitalia stakes

Lufthansa doesn't want Alitalia to become a stronger competitor through the partnership with Delta. The German airline now wants to become a minority shareholder.

Everything had already been decided – or at least so it seemed. The airport operator Atlantia and Delta Air Lines would take over FS Alitalia under the leadership of Ferrovie dello Stato Italiane. However, the negotiations on the definitive form of the cooperation and the future strategy of the Italian national airline continue to drag on. The last deadline passed without results. Now everything has to be decided on 21 November.

Lufthansa had always shown interest in Alitalia as well, but repeatedly imposed conditions such as a majority shareholding, no state participation or a massive reduction in size. This was rejected by the Italians. However, for some weeks now the German airline has been negotiating again with the parties involved. Apparently Lufthansa is concerned that northern Italian customers will turn to the then stronger competition when Delta becomes Alitalia’s long-haul partner.

Fewer redundancies at Alitalia

That is why, according to various Italian media reports, Lufthansa is now willing to become a minority shareholder in Alitalia. On Thursday (31 October) an Italian delegation travelled to Frankfurt to better understand the ideas of the Germans. As the newspaper Corriere della Sera writes, Lufthansa is now offering 150 million euros for a stake. According to the report, the takeover of the shares should not take place immediately, but step by step.

The report states that the requirements for the acquisition have been reduced. The German company no longer demands the reduction of 6000 jobs and a fleet of a maximum of 75 to 80 aircraft. According to Corriere della Sera, who relies on three sources, Frankfurt is now satisfied with 90 to 100 aircraft (116 today) and a reduction of 4000 of the current slightly more than 11,000 jobs. For the Italians, however, this is still too much.

Fleet is getting much smaller

However, Lufthansa should at least accommodate the pilots of Alitalia’s regional subsidiary Cityliner in the redundancies. According to the report, the Germans are offering them a job with their Italian subsidiary Air Dolomiti. The fleet of 15 Embraer E175 is to be completely dissolved, according to the plan. In addition, five old Airbus A321 and the only 777-300 ER are to leave the fleet.

It remains to be seen how Delta will react. The Americans  are said to have meanwhile increased their offer.

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