Lufthansa Group has been given the green light by the European Commission to acquire a 41% stake in ITA Airways. This marks a significant milestone in the long-standing effort to privatize the Italian carrier, a process that began even before ITA Airways emerged as the successor to the struggling Alitalia in October 2021. The acquisition, valued at €325 million ($341.5 million), is expected to take place in early 2025 and includes provisions for Lufthansa to eventually gain full ownership, which is estimated to end up costing around €800 million ($840.6 million).

To ensure regulatory compliance, Lufthansa and ITA Airways have agreed to relinquish slots at Milan Linate Airport, creating room for competitors such as EasyJet. Additionally, they are tasked with fostering increased competition at Rome Fiumicino Airport, particularly for Star Alliance carriers’ transatlantic routes.

This acquisition advances Lufthansa Group’s strategic aim of strengthening its presence in Italy, a key market outside its core regions. ITA Airways is slated to become an integral part of Lufthansa Group’s multi-brand network, complementing existing carriers like SWISS and Austrian Airlines. The airline will integrate into the Star Alliance, replacing its current affiliation with SkyTeam, and will adopt the Miles & More frequent flyer program.

Lufthansa and ITA Airways

Our Take

This move by Lufthansa Group to acquire a significant stake in ITA Airways underscores Italy’s pivotal role in the airline’s strategic expansion. It’s clear that Lufthansa aims to consolidate its foothold in the Italian market, traditionally a SkyTeam stronghold. By transitioning ITA Airways from SkyTeam to Star Alliance, Lufthansa not only shakes up the competitive landscape but also significantly broadens its own network reach. However, given the historical financial struggles associated with Alitalia, Lufthansa faces challenges. ITA Airways’ recent turnaround to profitability is promising, yet maintaining this momentum under new ownership will demand precise management and strategic oversight.

For travelers leveraging points and miles, this deal holds considerable promise. ITA Airways’ integration into Star Alliance brings substantial benefits, enhancing award availability and flexible routing for frequent flyers. The transition to Lufthansa’s Miles & More program could provide better redemption opportunities, potentially opening up a wealth of travel options across Europe and beyond. We look forward to seeing how ITA’s operational strategies evolve, especially concerning its relationship with existing Lufthansa Group airlines and how these could impact available routes and services for points and miles travelers.