Lufthansa-ITA wedding: why five months after the announcement, it's still stuck
More than five months have passed since Ita Airways and Lufthansa announced their intention to 'marry,' with the German carrier [...]
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It has been more than five months since Ita Airways and Lufthansa announced their intention to 'marry', with the German carrier that late last May had made it official to join the Italian company through the acquisition of 41% of shares (and the possibility, within ten years, to rise to 100%).
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In June, the Italian Court of Auditors had given the green light to the operation., which has since passed into the hands of the European Antitrust Authority. But, to date, no white smoke has come from that of Brussels. The situation seems to be stalled, apparently not only 'because of' European bureaucrats.
In fact, as of the end of September, no formal notification of Lufthansa's entry into ITA would reach the Antitrust Authority's desk, according to European Commissioner Didier Reynders. Brussels would only get a pre-notification. And the reason would lie in the conditions placed by the Antitrust Authority on the German carrier, which would have prompted it to pull the handbrake for further evaluation and negotiations with Brussels.
Reason for contention would be, mainly, transatlantic routes from the Frankfurt and Munich hubs that the EU reportedly asked Lufthansa to give up because of the go-ahead for the agreement with Ita. Also an obstacle would be the six routes that would become de facto monopolies under Luftansa/ITA as a result of the wedding: those between Milan, Frankfurt, Dusseldorf and Stuttgart and those between Rome, Frankfurt, Munich and Zurich.
The consequence is. The two companies should give up slots on affected airports to foster competition (which in Frankfurt and Zurich is itself reduced due to the absence from the two airports of any low-cost airlines). ITA, in this respect, has already been penalized when, succeeding Alitalia, it was forced to give up 15% of the slots held by the latter at Linate and 57% of those held at Rome Fiumicino. And so, Lufthansa and Swiss may have to give up 13 pairs of slots (8 of them at Linate), while ITA would have to say goodbye to 5 pairs of slots (4 of them at Milan's city airport).
At a three-way Rome-Frankfurt-Brussels summit on Monday, the antitrust authority reportedly made new demands to the Germans ending up slowing down the process for official notification of the investment even more.
Lufthansa and ITA, moreover, are not the only two companies 'hostage' to Europe: In the same condition, and for longer, are the IAG group (combining, among others, British Airways and Iberia) and the Spanish carrier Air Europa (particularly 'strong' in connections between Madrid and Latin America), with respect to which IAG would like to increase from 20% to 100% of shares. The announcement of the complete acquisition had been made as much as seven months ago. And still the Antitrust Authority has not ruled.
We will see if they will be quicker in Brussels in To give the green light to the agreement by which Air France intends to enter Scandinavia Airlines. acquiring 20%. In Rome and Frankfurt they often speak of a French 'direction' that would delay the go-ahead for Lufthansa's entry into ITA for the interests of the other major European group, formed by Air France and KLM.
