Lufthansa Acquires 10% Stake in airBaltic to Expand Europe
Germany’s Lufthansa Group has officially acquired a 10% stake in Riga-based Latvian flag carrier airBaltic, marking a significant step in its strategy to strengthen its presence in the European aviation market. Announced on Wednesday, January 29, 2025, this €14 million ($14.6 million) investment underscores Lufthansa’s commitment to expanding its network and enhancing strategic partnerships within the region.
The acquisition, initially proposed by Lufthansa Group in October 2024, was formalized through an agreement signed between the Latvian Ministry of Transport and Lufthansa Group. As part of the deal, Lufthansa not only secures a minority stake in airBaltic but also gains a seat on the airline’s Supervisory Board. This 10% convertible share can be transformed into ordinary shares should airBaltic pursue an Initial Public Offering (IPO) in the future. According to airBaltic, the exact size of Lufthansa’s stake will be determined by the market pricing at the time of the IPO, ensuring that Lufthansa holds no less than a 5% share.
The transaction is slated to close in the second quarter of 2025, pending approval from EU competition authorities. This move follows Lufthansa’s recent takeover of ITA Airways in Italy, further solidifying its influence in the European aviation sector.
In a statement, Lufthansa Group emphasized the strategic nature of the investment: “This transaction builds on the existing wet-lease agreement between Lufthansa Group and airBaltic and aims to strengthen airBaltic’s role as a strategic partner. Expanding this commercial cooperation allows us to enhance our network quality and enter additional markets. We also plan to further develop our wet lease services to meet customer expectations.”
The partnership between Lufthansa Group and airBaltic has been ongoing since 2019, demonstrating a reliable and valuable collaboration. Recently, the two airlines extended their wet-lease agreement for an additional three years beyond the summer of 2025. This extension allows Lufthansa Group carriers, including Austrian, Brussels Airlines, SWISS, Air Dolomiti, Discover, and ITA Airways, to utilize up to five of airBaltic’s Airbus A220-300 aircraft during the winter of 2024/25 and up to 21 aircraft in the summer of 2025 across various Lufthansa Group hubs.
Lufthansa Group highlighted the benefits of this extended agreement, stating, “By responding more flexibly to the increased customer demand for summer 2025, airBaltic’s additional capacities enable us to serve high-demand destinations more efficiently. This also enhances the quality and stability of our connections to Lufthansa Group Airlines’ intercontinental services at our hubs.”
airBaltic, Latvia’s national and largest airline, continues to expand its fleet with the recent addition of its 50th Airbus A220 aircraft from Airbus in Mirabel, Canada. This aircraft features a special celebration livery designed through a competition, symbolizing the airline’s growth and collaboration with Lufthansa Group.
Marjan Rintel, President and CEO of KLM, stated, “Our focus is 100% on laying a solid foundation for a healthy and future-proof KLM. A strong and competitive airline that is appreciated by customers and continues to connect the Netherlands with the rest of the world.” While this statement pertains to KLM’s restructuring efforts, it parallels Lufthansa’s strategic investments to ensure long-term sustainability and competitiveness in the aviation industry.
The Lufthansa Group’s investment in airBaltic is a strategic move to enhance its market position, leverage synergies, and provide more options and savings to customers. By integrating airBaltic’s fleet and expanding their collaborative efforts, Lufthansa aims to create a more resilient and expansive network, capable of meeting the dynamic demands of the European and intercontinental travel markets.
As Lufthansa continues to grow its footprint in Europe through strategic acquisitions and partnerships, the aviation industry will closely monitor the impact of these moves on competition, service quality, and market dynamics. The collaboration between Lufthansa Group and airBaltic is poised to deliver enhanced travel experiences, greater operational efficiencies, and a stronger presence in key European markets.
For more information on Lufthansa Group’s investment and future plans with airBaltic, visit Lufthansa’s official website or airBaltic’s official website.
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