Lufthansa Group repays financial aid from the German government

Carsten Sphor. Source: Lufthansa Group

Deutsche Lufthansa has repaid or cancelled all remaining stabilization funds from the German government which the carrier was able to access at the start of the pandemic.

Carsten Spohr, CEO of Deutsche Lufthansa, said: “Lufthansa was able to rely on Germany and Germany can rely on Lufthansa. Many challenges remain. Our ambition is to strengthen our position among the world’s leading airline groups. To this end, we will consistently continue the restructuring and transformation of the company.”

The German government’s package originally provided measures and loans totalling up to €9bn, of which the company has drawn down a total of around €3.8bn. This includes around €306m with which the Economic Stabilization Fund (ESF) built up its shareholding in Lufthansa group.

The Silent Participation II of the ESF amounting to €1bn was repaid in full today. The company had already repaid Silent Participation I in October, of which only €1.5bn was drawn, of which the unused and remaining part has now been terminated too.

The repayment was made much earlier than originally planned due primarily to the rising demand for air travel, restructuring and transformation of the Lufthansa Group and the capital markets’ confidence in the company, said a spokesperson.

Last February, the company repaid a loan of €1bn earlier than expected. This means that all German loans and Silent Participations, including interest, have now been repaid and terminated.

The ESF has undertaken to sell by October 2023 at the latest its stake in Deutsche Lufthansa, amounting to some 14% of the share capital.

Spohr said: “On behalf of all Lufthansa employees, I would like to thank the German government and the German taxpayers. In the most serious financial crisis in our company’s history, they have given us a perspective for the future. This has enabled us to save more than 100,000 jobs.

“We are proud that we were able to keep our promise earlier than expected and repay the German financial aid. I would like to thank our employees for their great commitment and especially our customers who have remained loyal to us in these challenging times.

Remco Steenbergen, CFO of Deutsche Lufthansa AG, said: “We are determined to further strengthen our balance sheet, increase our profitability and generate attractive capital returns.

“Our financial targets published in June show this very clearly. We are convinced that we will create sustainable value for our shareholders.”

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