The European Commission has declined to comment on media reports that Lufthansa Group has made even further concessions to Brussels to sweeten its proposed EUR325 million euro (USD353 million) merger with Italian flag carrier ITA Airways (AZ, Rome Fiumicino).
The move comes amid concerns over a potential European Commission veto of the deal, according to online newspaper Politico, citing two unnamed sources. The Commission reportedly reacted with scepticism to Lufthansa Group's new offer in what is now viewed as a political issue, with Italy lobbying for approval and Lufthansa emphasising the deal's importance for ITA Airways' survival. The heightened political mood became evident when Italy's deputy prime minister Matteo Salvini warned that it would be an "attack on Italy" if the Commission refused to authorise Lufthansa Group's acquisition of a 41% stake in ITA Airways, ANSA news agency reports.
Talks have focused on addressing competition issues on long-haul routes to North America, with the Commission seeking a longer commitment than Lufthansa's initial two-year pledge to keep ITA's business separate from its A++ transatlantic joint venture with United Airlines and Air Canada. The Commission had asked for a 10-year pledge, Politico's two sources said. The new offer from Lufthansa Group reportedly represents the final attempt to address the Commission's concerns.
On May 28, EU Competition Commissioner Margrethe Vestager said the discussions were ongoing. "We are still discussing pro-competitive remedies because we need to deal with the risk that consumers may have to pay high prices in the future and have less choice," she was quoted by Il Sole 24 Ore, the Italian financial newspaper.
No further documents have been filed on the case on the European Commission case file, the last filing reflecting that the parties submitted revised commitments on May 6 to address the preliminary competition concerns. The deadline for the Commission to take a decision has been extended to July 4, 2024.
Lufthansa Group also declined to comment. A spokesman said, "Lufthansa Group remains in constant exchange with the European Union to support them with their investigation and stays confident that the EU Commission will approve the agreed participation in ITA Airways as soon as possible."
As reported by ch-aviation, on May 21 the Lufthansa Group and ITA Airways agreed to sacrifice at least 19 daily slot pairs at Milan Linate, to be shared by budget carriers easyJet and Volotea, which would establish bases at the airport. ITA Airways would be kept out of the transatlantic alliance for two years. Italy and Germany would sign special prorate agreements with rival carriers such as British Airways, Air France, and KLM Royal Dutch Airlines, to ensure competition on long-haul routes.
