Lufthansa stock soars as billionaire OKs bailout

Lufthansa stock soared Thursday (June 25).

That after investor Heinz Hermann Thiele dropped his objections to a state bailout.

The billionaire investor owns just over 15% of the firm’s stock.

Now he says he won’t veto the $10 billion rescue deal.

That will see the state take a 20% stake and board seats, diluting existing shareholdings.

Thiele’s comments come despite deadlock in talks with the government Monday (June 22).

Finance Minister Olaf Scholz refused to countenance changes to the plan, which he said was carefully drafted to secure EU approval.

That green light duly came on Thursday.

Brussels says it will approve the deal, but wants dividends and share buybacks banned until state support is paid back.

Germany will also have to come up with a restructuring plan for the airline if it has not sold off its stake within six years.

Now approval of the deal by shareholders will ease fears that Lufthansa might have to seek protection from creditors.

Overnight the firm also struck a deal with flight attendants on cost savings totalling over 500 million euros.

Lufthansa stock soared as much as 27% in early trade Thursday, before settling back around 15% higher.