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German Government Sells Remaining Lufthansa Shares

By Dave Simpson

The German government has sold off its 20% stake in Lufthansa acquired during the coronavirus pandemic, it has said.

The state's economic stabilisation fund (WSF), which saved Lufthansa from bankruptcy during the pandemic with a bailout package totalling €9 billion, had progressively reduced its stake in recent years with the aim of offloading it completely by October of 2023.

It has now sold its last remaining shares to international investors in a block placement for €455 million, the fund said in a statement on Tuesday 13 September night.

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It earned a total of €1.07 billion from selling its shares, yielding a €760 million profit from the investment.

"The government aid package successfully helped the business through the crisis," it said.

Deutsche Bank, one of the global coordinators and bookrunners for the sale alongside Goldman Sachs, said earlier on Tuesday 13 September that the fund wanted to offer institutional investors around 74.4 million Lufthansa shares, corresponding to 6.2% of the airline's share capital.

Lufthansa shares closed down 1.5% at €6.32 per share on Tuesday 13 September.

Lufthansa 100% Privately Owned Again After COVID Bailout

The German government has sold all of its remaining shares in Lufthansa, the airline said on Wednesday 14 September, meaning that the company is now back in the hands of private investors after a state bailout kept it afloat during the COVID-19 pandemic.

Kuehne Raises Lufthansa Stake To 17.5% As Germany Sells Remaining Shares

All of the above news was followed by news that logistics entrepreneur Klaus-Michael Kuehne has increased his stake in Lufthansa to 17.5%, Kuehne Holding said on Wednesday 14 September, after the German government sold all its remaining shares in the airline.

"This underlines Kuehne Holding's positive view of the company," Kuehne Holding added in a statement to Reuters.

The German government said on Tuesday 13 September it had sold off its 20% stake in Lufthansa, which it acquired during the coronavirus pandemic to keep the airline afloat, meaning that the company is now back in the hands of private investors.

The state's economic stabilisation fund (WSF), which saved Lufthansa from bankruptcy during the pandemic with a bailout package totalling €9 billion, had progressively reduced its stake in recent years with the aim of offloading it completely by October 2023.

After the sale of its remaining shares, the WSF no longer holds a stake in Lufthansa.

"This brings the stabilisation of Lufthansa to a successful conclusion. Lufthansa is once again fully in private hands," Lufthansa CEO Carsten Spohr said in a statement.

Sale Of Lufthansa Technik Stake Draws Interest From Financial Investors - Source

All of the above news was followed by news that Lufthansa's plan to sell a stake in its aircraft maintenance business Lufthansa Technik has drawn more interest from financial investors than rival engineering firms, a source told Reuters on Thursday 15 September.

Lufthansa was more likely to opt for a stake sale of around 20-30% than the alternative of launching an initial public offering, the source added.

Separately, business daily Handelsblatt reported that Lufthansa is planning to start talks with private equity investors in December about the stake sale.

In a best case scenario, the board could then have a list of non-binding offers in January of next year, Handelsblatt said. The board is aiming for a valuation of between €6 billion and €8 billion including debt, it added, citing Lufthansa sources.

Lufthansa's chief financial officer, Remco Steenbergen, had said in August the sale process would start in early 2023. He left open whether Lufthansa had committed itself to selling shares and dropped the idea of an IPO. Lufthansa did not want to comment on this when asked by Reuters on Thursday 15 September.

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.

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Enjoy full access to Hospitality Ireland, our weekly email news digest, all website and app content, and every digital issue.
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