By Pierre Bertrand
The European Commission cleared proposals by Lufthansa and the Italian government, saying that they satisfied conditional requirements to allow the German airline to acquire a minority stake in ITA Airways.
The commission late on Friday said that easyJet, Air France-KLM and British Airways owner International Consolidated Airlines were suitable to assuage its competition concerns, paving the way for the German airline and Italy's economy and finance ministry to finalize the transaction.
Lufthansa received the green light from the commission in July to take on 41% of ITA Airways, on the condition that it shed some short-haul routes, transfer take-off and landing slots at Milan Linate Airport and make concessions on long-haul flights.
As part of the approved remedies, easyJet will start non-stop short-haul flights between Italy and central Europe and take on landing and take-off slots in Milan, the commission said.
Air France-KLM and IAG, meanwhile, were granted concessions increasing their competitiveness on key long-haul routes connecting Italy with North America.
Lufthansa and Italy reached an agreement on ITA Airways in May of last year calling for the German carrier to inject 325 million euros ($343.8 million) into ITA Airways, with Rome pouring a further 250 million euros into the airline's coffers.
The ITA-Lufthansa deal put an end to a years-long quest by the Italian government to ease state's control of ITA Airways, which started operating in late 2021.
Alitalia, ITA's predecessor, had been mired in bankruptcy proceedings even before the Covid-19 pandemic upended air travel. The company struggled to make money amid the rapid expansion of European low-cost carriers.
Write to Pierre Bertrand at pierre.bertrand@wsj.com
(END) Dow Jones Newswires
December 02, 2024 02:09 ET (07:09 GMT)
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