Mateusz Maszczynski is a serving international flight attendant with experience…
Lufthansa will be forced into insolvency if a major shareholder votes against a €9 billion taxpayer-funded rescue package at a make or break general meeting on June 25, the company warned on Wednesday. German billionaire businessman, Heinz-Hermann Thiele told the Frankfurter Allgemeine Zeitung (pay-wall) that he didn’t believe Lufthansa had yet exhausted all other possibilities before allowing the German government to take a 20 per cent stake in the airline.
Thiele, who is said to be worth $16.9 billion, refused to say whether he would actually vote against the rescue package in the interview published on Tuesday but said Lufthansa boss Carsten Sphor must “develop a feeling for what the major shareholders think.” When asked if Sphor had negotiated hard on behalf of shareholders, Thiele again refused to give a definitive answer citing a lack of transparency from the airline chief executive.
Sphor had attempted to convince shareholders at the company’s annual general meeting earlier this year that a government bailout was necessary to secure the future of the German flag carrier and its subsidiaries. Investors were reassured that State management of the airline would not form part of the bailout.
On June 1, the Lufthansa executive board approved the €9 billion package but the final hurdle it must pass is shareholder approval. A two-thirds majority will be required to approve the bailout if attendance at the general meeting on June 25 falls below 50 per cent. At the airline’s AGM on May 5, attendance was registered at just 33 per cent.
Such low attendance could allow Thiele to vote down the rescue package. Yesterday he revealed he had increased his stake in the airline to 15 per cent.
But if more than 50 per cent of shareholders attend the meeting – which is being held virtually – then only a simple majority of votes is required to approve the bailout.
“The Management Board urgently appeals to all private and institutional shareholders to exercise their voting rights and to participate in the decision about the future of the company,” the company urged in a statement. The UFO cabin crew union has urged its members who hold shares in the airline to take part in the vote or even transfer their voting rights to the union.
The German government’s Economic Stabilization Fund (WSF) has proposed a €9 billion bailout in return for a 20 per cent stake in the airline, as well as two seats on the Lufthansa supervisory board. The WSF says it would only use its voting rights in the case of an attempted foreign takeover of the airline.
To appease European competition regulators, Lufthansa has agreed to cede control of 24 take-off and landing right at its hubs in Frankfurt and Munich for 18-months.
Even with the multi-billion Euro bailout, Lufthansa recently told employees that up 22,000 jobs could be lost as a result of the Corona crisis. Negotiations with trade unions continue.
Mateusz Maszczynski is a serving international flight attendant with experience at a major Middle East and European airline. Mateusz is passionate about the aviation industry and helping aspiring flight attendants achieve their dreams. Cabin crew recruitment can be tough, ultra-competitive and just a little bit confusing - Mateusz has been there and done that. He's got the low down on what really works.