No alternative to deal with Lufthansa, ITA Airways chair says

Credit: REUTERS/REMO CASILLI

By Angelo Amante

ROME, March 27 (Reuters) - ITA Airways sees no plan B alternative to a proposed merger with Lufthansa LHAG.DE which has the full backing of the Italian government and the German airline, ITA's chairman said on Wednesday.

Lufthansa is seeking to buy a 41% stake in state-owned ITA, which officially replaced loss-making Alitalia in 2021, but the deal is facing hurdles as European regulators warn it could harm competition and push up prices.

"On the part of the Treasury and Lufthansa there is a strong commitment to studying solutions ... There is no plan B because we strongly believe in plan A," Chairman Antonino Turicchi told reporters at ITA headquarters in Rome's Fiumicino airport.

Lufthansa is planning to buy the stake in ITA from the Italian Treasury for 325 million euros ($352 million). Following the EU antitrust warning this week both parties said they would come up with remedies to get the deal off the ground.

The deadline for remedies is April 26, while the EU has until June 6 to decide whether to clear or block the deal. Turicchi said the deadline might be postponed until the end of June.

"We strongly believe in this marriage, this is our guiding star ... I feel like a bride-to-be and I'm waiting for prince charming," Turicchi joked with reporters, declining to speculate on alternatives to the Lufthansa deal.

The company generated adjusted core profit (EBITDA) of 70 million euros in 2023, after posting a net loss of around 486 million euros in 2022 due to lingering effects of the pandemic and rising fuel costs. ITA's 2022 revenues amounted to 1.5 billion.

ITA carried 14.8 million passengers in 2023, up 46.9% from 2022, achieving a 79% load factor on its planes, company slides showed. It ended last year with around 450 million euros in cashliquidity. ($1 = 0.9231 euros)

(Reporting by Angelo Amante and Giuseppe Fonte Editing by Keith Weir)

((Angelo.Amante@thomsonreuters.com; @AmanteAngelo;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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