Keen to repay government support as soon as possible, Lufthansa (LHAB) (LHA) raised €2.2 billion ($2.5 billion) in a capital increase. Some of those proceeds are going straight to repaying the Silent Participation I that it drew down from the German government’s Economic Stabilization Fund (ESF).
“We are very grateful that Deutsche Lufthansa AG was stabilized with tax money in the most challenging of times,” Chief Executive Carsten Spohr commented. “Today, we are keeping our promise and paying back a large part of the stabilization funds earlier than expected.”
“More and more countries are opening their borders, and demand for air travel, especially from business travellers, is growing daily.” However, the environment remains “challenging”, the chief executive said, adding Lufthansa (LHAB) (LHA) would continue efforts to restructure in order to defend its position among the world’s top five airline groups.
Before the end of 2021, Lufthansa (LHAB) (LHA) next plans to fully repay the Silent Participation II of €1 billion ($1.2 billion) and terminate the portion of the Silent Participation I that it has not used.
The government’s ESF currently owns 14.1% of Lufthansa’s (LHAB) (LHA) shares. It cannot sell any shares for the next six months, but will sell its stake within 24 months of the capital increase, which would be by October 11, 2023.