Lufthansa Reportedly Eyeing LOT

May 27, 2009

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The Polish government poured cold water on a report on Wednesday that Lufthansa was in talks to buy a stake in Polish airline LOT from the government in Warsaw.

"The privatisation process has not started yet," a spokesman for the Polish treasury ministry said.

He said that there were a few investors interested in LOT, but would not comment on whether Lufthansa was among them.

German newspaper Sueddeutsche Zeitung had reported, without citing sources, that LOT chief executive Sebastian Mikosz and Lufthansa CEO Wolfgang Mayrhuber had met to discuss a possible takeover.

Lufthansa declined to comment on the matter.

This is not the first time Germany's flagship carrier has been reported to be interested in the Polish national carrier.

In January 2008, a Polish newspaper had cited Poland's Deputy Treasury Minister Zdzislaw Gawlik as saying Lufthansa was interested in buying a majority stake in LOT. The report came as Poland's government was determined to relaunch the stalled privatisation of state companies, including LOT.

LOT, which celebrated its 80th anniversary this year, is about 68 percent owned by Poland's treasury.


Lufthansa already has its hands full with other pending mergers and acquisitions.

It is in the process of taking over a majority stake of UK airline bmi and is awaiting European Commission approval of its purchases of Brussels Airlines and Austrian Airlines (AUA).

The Commission is reviewing the impact of its AUA acquisition on competition and on whether Austrian state aid involved in the deal was in line with aid rules.

The Commission has not set a deadline for the aid review, but Lufthansa has said it could drop the deal if it was not completed by July 30.

EU Commission President Jose Manuel Barroso said he expected a decision on the AUA acquisition soon.

"We know that this is very important for Austrian Airlines," he said, adding further information from the two companies was needed to decide the matter.

AUA's shareholders have already tendered about 85 percent of shares in the loss-making carrier, Lufthansa said this month, after a 4.49 euro-per-share public offer expired.