EU Commission grants conditional approval for Lufthansa's acquisition of troubled ITA airline

In a significant development, the European Commission has given the green light to Lufthansa's acquisition of Italian airline ITA, marking a pivotal moment described by Italy's finance minister as "historic." Lufthansa is set to invest 325 million euros to secure a 41% stake in ITA, formerly known as Alitalia, with plans to attain full control by 2033 through a total investment of 829 million euros. The approval comes after a thorough year-long investigation, with conditions in place to safeguard competition, particularly concerning routes from Rome and Milan to North America, where Lufthansa, ITA, and their partners hold significant control. Under the approved deal, the merged entity must facilitate the entry of rival airlines on key routes, such as enabling non-stop flights between Rome or Milan and central European airports, where competition is currently limited. Additionally, provisions include accommodating competitors on long-haul routes to the United States and Canada, as well as allocating slots at Milan's Linate airport to other airlines. Italian Finance Minister Giancarlo Giorgetti emphasized the significance of this agreement in relieving the government from continuous financial injections into the struggling company, previously under state control since 2021. The move signifies the end of an era of state aid, with Giorgetti highlighting the potential for ITA's expansion to benefit the Italian economy, particularly focusing on Rome's Leonardo Da Vinci Airport as a crucial hub for routes to North America, Asia, and Africa, vital for the tourism sector. The deal with Lufthansa not only secures a substantial investment in ITA but also sets the stage for a strategic shift in the airline's operations, aiming to enhance competition and route development. By allowing for increased market access and promoting fair competition, the agreement is poised to reshape the aviation landscape in Italy, with a focus on bolstering connectivity to key international destinations. The conditions imposed by the European Commission underscore the importance of maintaining a level playing field in the aviation sector, ensuring that consumers benefit from a diverse range of flight options and services.