German airline Lufthansa has moved closer to purchasing a stake in Italian flag carrier ITA Airways after its business plan was officially approved by ITA Airways’ board of directors on March 30.

Lufthansa CEO Carsten Spohr reportedly met with Italy’s Ministry of Economy and Finance and ITA Airways’ top management in Rome last week to finalize negotiations to acquire 40% of the state-owned carrier, with options to buy the remaining 60% at a later date.

According to local news reports, the final snag in negotiations is price, with Spohr telling journalists the carrier’s assessment represents “the last real hurdle in the discussion” after its 2022 financials, posted last month, revealed a loss of approximately $530 million.

The carrier, which replaced legacy brand Alitalia in 2021, said in a statement the results were “consistent with the company’s ‘start-up’ phase” and reflected a “complex market” affected by rising fuel costs and the lingering effects of the pandemic. Nevertheless, the airline said it expects “substantial growth” in revenues for the next 12 months, driven by network expansion and a growing fleet.

In January, Italy’s finance minister Giancarlo Giorgetti signed a memorandum of understanding with Lufthansa, which marked the beginning of “exclusive” talks. Details of the offer were not disclosed at the time, but the value of ITA was estimated to be between $275 million and $325 million, according to local news reports.

Following the latest negotiations in Rome, Spohr reportedly said a final deal was “still weeks away”, but that a decision is expected by April 24.

Source: BTN Europe