Germany’s Lufthansa is not in talks about Etihad Airways taking a stake in the German airline, two sources familiar with the matter said on Tuesday, denying an Italian newspaper report that said it was.
“A financial stake is out of the question at the moment“, the source, who is familiar with Lufthansa’s plans, told Reuters. Italian paper Il Messaggero earlier on Tuesday reported that Etihad and Lufthansa were in talks about an Etihad taking a 30-40 percent stake as a precursor to a merger, although analysts said they viewed a deal as unlikely. The report sent Lufthansa’s share price up by over 6 per cent earlier on Tuesday before closing up 4.3 per cent at 11.81 euros. Media speculation has swirled around Etihad and Lufthansa in recent months as Etihad grapples with two loss-making European airlines in which it owns minority stakes – Alitalia and Air Berlin. There have also been media reports that Italian shareholders in Alitalia are keen for Lufthansa to invest in the Italian carrier, which is working on a fresh turnaround plan, along with speculation that Lufthansa could take on more of Air Berlin.
However, greater cooperation with Lufthansa could help Etihad, especially given the growth of Qatar Airways, CAPA-Centre for Aviation senior analyst Will Horton said. “The rapid growth of Qatar Airways and its future expansion will make it harder and costlier for Etihad to stay relevant on its own – everything else aside“, he said in an emailed comment.