Lufthansa puts bailout to vote today

A make-or-break shareholders' meeting is about to be held today

Photo: AP

The fate of Germany's ailing Lufthansa airline will be decided on Thursday at an extraordinary shareholders' meeting, in which a €9bn ($10bn) government bailout will be put to a vote.

Lufthansa has spiralled into crisis as a result of the catastrophic impact of the coronavirus pandemic on air travel. The deal, which Lufthansa has said is necessary in order to save the company from insolvency, would require the German government taking a 20% share in the company.

Valued at around €300m, that stake is only a small part of the total package - but it has irked investors, who will see their own shares diluted as a result of the state intervention. Meanwhile, the government is set to pay €2.56 per share, around a quarter of the current stock market price.

EU regulators have already given the bailout their approval.

The outcome of the online meeting largely comes down to one man, Lufthansa's biggest shareholder, Heinz Hermann Thiele. He had been critical of the deal, but in an interview with the Frankfurter Allgemeine Zeitung on Wednesday he said he had decided to vote in favour of it.

Shareholder presence at the online meeting is expected to represent less than 50% of capital. This means a two-thirds majority is needed in the vote - which would have been a tall order without Thiele's backing. He holds a 15.5% stake.

More on this subject: Coronavirus

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