- Heinz Hermann Thiele was convinced.
- Ironically, Ryanair wants to file a lawsuit.
- Tough austerity measures will follow.
Today (25.06.2020) everyone can first Lufthansa (WKN: 823212) shareholders and employees take a deep breath. Despite all opposition, 98.04% of the registered shareholders approved the state rescue package. However, they only represented 39.3% of all voting shareholders.
Heinz Hermann Thiele was convinced
Because of the low participation Knorr brakes (WKN: KBX100) billionaire Heinz Hermann Thiele, who secured 15.5% of Lufthansa shares from March 2020, tip the scales at the end. However, in a previously scheduled meeting between the finance minister, the economy minister, Lufthansa and HH Thiele, the entrepreneur was persuaded to agree. He is afraid that the state will exert too much influence and that restructuring will be difficult to implement but necessary. Lufthansa could (according to its own statements) come out of the crisis too weakly.
The ministers, however, have given assurances that they will only participate temporarily and will sell again later, if possible at a profit. Lufthansa now receives 9 billion euros in tax money, which I hope will not be lost. Specifically, the state takes over 20% of Lufthansa shares with the help of the economic stabilization fund and makes a silent contribution for EUR 5.7 billion. A further up to EUR 3 billion is to be made available as a loan.
However, there will be no dividends for shareholders during the state participation phase and the company is not permitted to buy back shares or takeovers. Politics is somewhat relieved about the bailout, otherwise it would be next this week Wirecard (WKN: 747206) a second DAX group slipped into bankruptcy.
In addition to maintaining the critical infrastructure, it also has an interest in ensuring that Lufthansa is not taken over by other large corporations. This can no longer occur via the voting rights of the state.
Ironically, Ryanair wants to file a lawsuit
The EU had conditionally approved the rescue package. For example, Lufthansa has to give up 24 landing and take-off rights to the competition in Frankfurt and Munich. The very controversial Ryanair (WKN: A1401Z) Lufthansa would have preferred to see the bankruptcy in order to secure its market share.
She has been using very dubious methods since inception. For example, the pilots have to set up their own company in order to fly for Ryanair and are therefore not socially protected. This is just one of many examples. And now Ryanair of all things sees a violation of the law by the state rescue of Lufthansa.
The company would therefore like to bring an action before the Court of Justice of the European Union. She sees a breach of the competition rules, which will certainly always occur with state participation, but since almost every airline in the world is currently supported by the state, competition is only “frozen” for a transitional period and is therefore not hindered.
Tough austerity measures will follow
The coming time will not be easy for Lufthansa. There are 22,000 jobs available. Instead of cutting staff numbers, the Executive Board is currently discussing a cut in salaries of around 20%. The UFO union has also approved a savings package that will cut costs by 500 million euros.
In addition, Lufthansa now has to reimburse passengers who were unable to start their booked flights, tickets worth around 1 billion euros. The German part of the SunExpress joint venture between Turkish Airlines (WKN: 908558) and Lufthansa, on the other hand, will cease operations. It included 65 machines and 1,200 employees.
Conclusion
The rescue is positive for the Lufthansa share. However, it will probably only be able to grow more strongly once the company returns to the profit zone, which is only possible through a far-reaching restructuring.
The post 9,000 million euros state rescue secured! What is the next step with the Lufthansa share? appeared first on The Motley Fool Germany.
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Christof Welzel does not own any of the shares mentioned. The Motley Fool does not own any of the stocks mentioned.
Motley Fool Deutschland 2020
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