Reports are beginning to emerge that German flag carrier Lufthansa may announce a 40% acquisition of new Italian airline ITA Airways as early as next week. The companies involved are reportedly close to finalizing a deal concerning the partnership.

Getting close to a deal

Next week could see an announcement regarding a partnership between German and Italian flag carriers Lufthansa and ITA Airways. According to Reuters, this would see the Cologne-headquartered airline acquire a 40% stake in the carrier that has taken over from Alitalia as Italy’s national airline. This follows reports in Italian newspaper Il Foglio.

The ongoing coronavirus pandemic has proved a huge challenge for airlines, and ITA’s launch came at a difficult time. It took to the skies in October 2021, and, as Simple Flying reported yesterday, has since posted a loss of EUR 170 millions

This has prompted it to consider reverting to the old Alitalia branding. Continued losses of such a magnitude would not make for a sustainable operation. As such, involvement from established carriers like Lufthansa could help to steady the ship at ITA. A.

ITA has lost nearly $200 million since hitting the skies last October. Photo: Getty Images

What could the partnership involve?

what might a deal between ITA and Lufthansa consist of? Apart from the significant minority stake that a 40% acquisition would provide Lufthansa with, the partnership may also impact ITA’s network. Indeed, Reuters notes that an aspect that has formed part of the discussions is developing Rome-Fiumicino as more

This would potentially have a particular focus on African and American routes. In terms of the next steps, a meeting between ITA’s management team and board members is set to occur at the end of the month. This will see the presentation of a strategic plan, with data and documents then being made available to those potentially interested in investing.

This will help companies like Lufthansa determine ITA’s worth. Of course, the German carrier has made partial acquisitions in other airlines before. Some of these have since become full subsidiaries of the Lufthansa Group. It will be interesting to see if it pursues this with ITA.