Lufthansa Group Mulls Stake in airBaltic Amid IPO Plans

Lufthansa Group is reportedly considering acquiring a stake in airBaltic as part of the Latvian airline’s upcoming privatization process, according to Bloomberg sources. While discussions are in the preliminary stages and no formal decisions have been made, this move could significantly impact both airlines, reported ch-aviation.com.

airBaltic is preparing for an Initial Public Offering (IPO) aimed at raising approximately EUR 300 million (USD 333 million) in new capital. Currently, the Latvian government holds a 97.97% ownership stake in airBaltic and plans to retain 25% of the shares following the IPO. Latvian Minister of Economy Viktors Valainis has hinted that a “well-known investor” is showing interest in the airline, though specifics remain undisclosed. The IPO is expected to take place either late in 2024 or early in 2025.

The airline, which has been a key ACMI (Aircraft, Crew, Maintenance, and Insurance) provider for Lufthansa Group, operates a fleet of five A220-300s for Eurowings, four for Lufthansa, and nine for Swiss. Additionally, airBaltic is set to open new crew bases at Brussels National, Munich, and Vienna—strategic hubs for Lufthansa Group. This expansion aligns with Lufthansa’s strategy to seek a long-term strategic ACMI partner. airBaltic’s fleet comprises forty-eight A220-300s, with 42 of these directly sourced from the manufacturer.

Lufthansa Group, which owns Lufthansa, Swiss, Austrian Airlines, Brussels Airlines, Eurowings, Discover Airlines, Air Dolomiti, Lufthansa Cargo, Lufthansa City Airlines, and Lufthansa CityLine, holds a diverse portfolio in the aviation sector. It also has significant stakes in other airlines, including a 50% share in AeroLogic, a cargo venture with DHL Express; a 41% stake in ITA Airways; and a 40% share in SunExpress, a joint venture with Turkish Airlines.

This potential investment underscores Lufthansa Group’s ongoing efforts to strengthen its position in the aviation market and enhance its operational capabilities through strategic partnerships.

Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com