EU antitrust ruling on Lufthansa’s ITA bid expected
EU antitrust regulators are expected to come to a decision regarding Lufthansa’s $348.5 million bid for a 41% stake in Italy’s state-owned ITA Airways, with the option to buy the rest later.
The European Commission originally delayed the decision in late April after expressing competition concerns regarding both short-haul and long-haul routes between Italy and the US, Canada, and Japan. Lufthansa has made the deal more amenable by providing remedies such as operating ITA independently for two years and giving away airport slots to easyJet and Volotea.
The most likely outcome may be conditional approval of the deal. A rejection would deeply strain relations between the EU and Italy. Italy’s deputy prime minister Matteo Salvini stated that a veto would be seen as a hostile act, as this deal is crucial to reviving ITA and preventing the Italian government from sinking further money into the failing airline. Moreover, the strong performance of Prime Minister Giorgia Meloni’s far-right Brothers of Italy party in the recent European parliamentary elections indicates a potential rise in nationalism, which would only be exacerbated by a rejection of the deal. Italy would likely perceive the EU as undermining its economic interests, fueling further nationalism and euroscepticism.
