Germany’s Lufthansa Group had reached a deal with the Italian government to acquire a majority stake in the Rome-based flag carrier ITA Airways for a price of €325 million.
Lufthansa first acquired a minority 41% stake in ITA Airways in January 2025, although it was always understood that the airline group would want to increase its stake and become a majority shareholder at some point.
ITA Airways was born out of the ashes of the now-defunct Italian flag carrier Alitalia, which was shuttered in October 2021 when the European Union barred Italy from pumping any more state aid into the beleaguered and heavily loss-making airline.
To get around this restriction, the Italian government simply created a new airline that took control of all of Alitalia’s assets. ITA Airways was initially completely owned by the Italian government, although this was only to be a temporary arrangement while private suitors were found.
Within months, Lufthansa signalled it was interested in taking a controlling stake in ITA Airways, initially as part of a joint venture with the Geneva-based shipping conglomerate MSC Group.
In the end, MSC Group decided to drop out of the joint venture, but undeterred, Lufthansa went up against the Air France-KLM Group and Delta Air Lines in a bidding contest to acquire a stake in ITA Airways.
In the end, it was Lufthansa that prevailed, although not without some last-minute drama.
The €325 million deal was put in jeopardy after Lufthansa reportedly demanded a €10 million discount, arguing that the valuation of the airline had fallen after the date the provisional agreement was reached.
The deal was meant to be signed in November 2024, but after the eleventh-hour bust-up, it wasn’t until January 2025 that Lufthansa finally acquired the initial 41% stake in ITA Airways.
Lufthansa has raced to integrate ITA Airways into the wider Lufthansa Group, quickly adding codeshare agreements, before moving ITA from the Skyteam airline alliance to Star Alliance, of which it is a founding member.
In the last couple of months, ITA Airways has also been integrated into the Lufthansa Group’s shared website and mobile app ecosystem and has fully adopted the group’s Miles & More frequent flyer program.
Lufthansa said on Tuesday that it was now exercising an option in its original deal with the Italian government to acquire a further 49% in ITA Airways, bringing its stake to 90%.
Italy’s Ministry of Economy and Finance will continue to hold the remaining 10% stake in ITA Airways when the deal finalizes. Pending reviews by the European Commission and the U.S. Department of Justice, the deal should be completed in early 2027.
The following year, Lufthansa will then have the option to purchase the remaining 10% from the Italian government.
Lufthansa Group chief executive Carsten Spohr boasted on Tuesday about the speed at which ITA Airways has been integrated, albeit with one major exception – North Atlantic flights are still sold separately, regulatory approval is still pending.
