ITA Airways Stays Committed to Lufthansa Merger Amid Regulatory Hurdles

ITA Airways is steadfast in its pursuit of a merger with Lufthansa, with the plan receiving solid backing from both the Italian government and the German airline, despite facing scrutiny from the European Commission over antitrust concerns. ITA Airways chairman Antonino Turicchi has underscored the airline’s dedication to the merger, emphasizing that there is no alternative envisioned to this strategic alliance.

Lufthansa’s proposal to acquire a 41% stake in ITA Airways for EUR325 million is currently under review by the European Commission, which has raised concerns about the potential impact on competition and fare increases on specific routes. The parties involved are actively seeking remedies to address these challenges ahead of an April 26 deadline, with the Commission’s final decision expected by June 6, though this could extend to the end of June.

One potential strategy to navigate regulatory hurdles includes revising the ownership structure, potentially reducing Lufthansa’s stake to 19.9% and raising the Ministry of Economy and Finance’s share to 80.1%. This approach, however, could limit the merger’s ability to harness the full range of commercial and industrial synergies that a closer partnership with Lufthansa would facilitate.

Turicchi’s remarks during a press briefing highlight the strong belief in the merger’s benefits and the absence of a backup plan, indicating a unified resolve to overcome regulatory obstacles. “There is no plan B, let’s move forward with Lufthansa,” Turicchi asserted, reflecting a commitment to the strategic direction set forth.

The European Commission’s concerns stem from the extensive network of routes operated by Lufthansa and ITA Airways, as well as Lufthansa’s existing transatlantic joint ventures, which could potentially restrict competition and lead to higher fares on certain routes.

As the June deadline approaches, ITA Airways and its partners are focused on addressing the European Commission’s concerns, working towards a successful merger that will bolster their competitive positions in the global aviation market.