The German government has announced its intention to immediately sell of 25% of its stake in Lufthansa, the country’s flag-carrying airline, with the intention of divesting itself of the total investment by 2023.
The original €300 million investment came from Germany’s Economic Stabilization Fund (WSF) which was set up in March 2020 to aid struggling major German companies in an attempt to save jobs. The total bailout package was €9 million, €5.7 billion of which was a silent capital contribution by the state and a €300 million share package, along with a €3 billion loan from state-owned bank KfW which, in June 2020, effectively saved the struggling carrier from bankruptcy.
The move comes as part of a joint decision for Lufthansa to regain financial independence as soon as possible, especially in light of the carrier halving its losses in 2021 compared to the same period in 2020, mainly as a result of over 30,000 job cuts and an easing of travel restrictions. Lufthansa is also looking to pare back its fleet of aircraft from 800 to 650 by 2023. (€1.00 = US$1.18 at time of publication.)