Lufthansa
AviationWorld News

German government to control 20% of Lufthansa airlines in exchange for €9 billion bailout

483

The German government agreed to a €9 billion deal on Monday to save flag carrier Lufthansa, turning the German government into the single largest shareholder in Europe’s second-largest airline as it looks to restart flights next month following weeks of lockdown.

Underscoring the trouble facing airlines, Lufthansa’s current market capitalization is less than the size of the bailout. But as a strategic asset for an export nation, keeping its flag carrier flying is a no brainer in Berlin with broad political support despite some concerns from the opposition Greens and liberals.

Lufthansa has been badly wounded by the coronavirus. Management said last month it is losing around €1 million an hour, and is carrying only about 1 percent of its normal passenger load.

Lufthansa Group, which also includes brands such as Austrian, Swiss, Brussels Airlines and Eurowings, was forced to ground almost all of its fleet and close its Germanwings subsidiary. The bailout puts wind behind Lufthansa’s plan to get flights going again to popular tourist hotspots such as Mallorca and Venice from next month.

The government has promised to appoint “independent experts” to its two board seats, which rules out politicians. In Germany’s multi-tiered corporate governance structure, which mandates worker representation on supervisory boards, keeping politicians out of the boardroom is important for executives who may need to make tough choices.

Leave a comment

Related Articles

Equatorial Guinea government official embroiled in sextape scandal

Mr. Baltasar Engonga, Director General of the National Financial Investigation Agency (ANIF)...

Just in: UK Conservative Party elects former Business Secretary Kemi Badenoch as new leader

Former British Business Secretary Kemi Badenoch has emerged as the new leader...

Ghana’s Shirley Ayorkor Botchwey is Commonwealth Secretary-General

The 56-nation Commonwealth has announced Ghana’s Shirley Ayorkor Botchwey as its new...

3 Africans Vie for Commonwealth Secretary General post

An Analysis Three African candidates – Ghana’s Foreign Minister Shirley Botchwey, Lesotho’s...

FG approves international airport for Kogi

The Federal Ministry of Aviation and Aerospace Development has approved Kogi State...

Port Harcourt chopper crash: NSIB recovers two more bodies from site

The Nigerian Safety Investigation Bureau (NSIB) has announced the recovery of two...

Commonwealth summit: Broken aircraft windscreen aborts Shettima’s trip

Following the damage to the cockpit windscreen of his plane at JFK...

Port Harcourt chopper crash: Three bodies recovered

A helicopter crash in Port Harcourt, Rivers State, has claimed the lives...

Keyamo in Geneva, calls for WMO’s collaboration for improved meteorology

Nigeria’s Minister for Aviation and Aerospace Development, Mr. Festus Keyamo (SAN), has,...

Trump’s wealth surges to $6.5bln as he re-enters Bloomberg Billionaires Index

Donald Trump’s wealth has climbed to $6.5 billion, positioning him at 481st...

Gold price hits record high of $2700 amid geopolitical tensions, US election uncertainty

Gold prices surged past the $2700 mark in early Asian trading on...

Brazilian Pres. da Silva hospitalized after a head injury, cancels BRICS Summit trip

Brazilian President Luiz Inacio Lula da Silva was hospitalized in Brasília after...

Goita’s Self-Promotion to 5-Star General and Junta Leaders’ Ambition

By Paul Ejime The decision by Assimi Goïta, who led two military...

Kenya’s VP’s impeachment: Pres. Ruto nominates Interior Minister as replacement

Barely a day after the Kenyan Senate impeached Deputy President Rigathi Gachagua,...

Nigeria’s aviation sector gets major lift as FG unveils 150m-litre jet A1 fuel depot

Nigeria’s Minister of Aviation and Aerospace Development, Mr. Festus Keyamo (SAN), has...

Sinwar’s reign ends: Israeli forces confirm Hamas leader’s killing

Israel has informed the U.S. that Yahya Sinwar, the Hamas leader behind...

Patronize Nigerian caterers as from January 2025, Aviation Minister tells foreign airlines

The Minister of Aviation and Aerospace Development, Mr. Festus Keyamo (SAN), has...

US bank fraud, money laundering allegations: Air Peace’s management reaffirms CEO’s innocence

Air Peace’s management has reaffirmed that its Chief Executive Officer, Mr. Allen...

CEO of Air Peace, airlines’ finance officer indicted for $44.9m fraud, obstruction of justice in U.S.

Allen Onyema, the Chairman/CEO and founder of Air Peace, a Nigerian airline,...