Lufthansa has held talks for majority stake in Alitalia: board member

Planes of German air carrier Lufthansa are seen at Germany's largest airport, Fraport, in Frankfurt, Germany, January 14, 2019. REUTERS/Kai Pfaffenbach

FRANKFURT (Reuters) - German airlines group Lufthansa has held talks to take a majority stake in ailing Italian carrier Alitalia and would be interested in a full takeover in the long run, Lufthansa board member Harry Hohmeister said on Monday.

Alitalia, which was put under special administration in 2017, would remain operationally independent within the Lufthansa group, with its own brand, he said.

Lufthansa has been a key player in hectic M&A activity in the industry, snapping up Brussels Airlines and parts of insolvent Air Berlin in 2017 to expand in the budget market.

“We are fighting for the Italian market and that includes Alitalia,” Hohmeister told Reuters, adding the group’s tough conditions for a takeover remained unchanged.

Italy’s daily Il Corriere della Sera reported on Sunday that Italian state railway Ferrovie dello Stato (FS) was set to choose on Tuesday its partner for a restructuring of Alitalia, with U.S. carrier Delta Air Lines in pole position.

Lufthansa is only prepared to buy in if Alitalia first undergoes a major round of job cuts under state administration and if it gets full control without co-ownership by the Italian government.

“We are interested in Alitalia but only if the conditions are right - they have not fundamentally changed,” Hohmeister said, adding Lufthansa wanted to own all of Alitalia in the long-term.

Hohmeister put the number of Alitalia staff that needs to be cut at fewer than 3,000, adding this should happen in a socially responsible way.

Lufthansa’s strong economic position should be “reason enough for those responsible at Alitalia to think about whether they want to be part of a strong European system or choose another path”.

Writing by Maria Sheahan and Christoph Steitz; Editing by Thomas Seythal and Kirsten Donovan