Lufthansa and Brussels Airlines have signed an agreement in which Lufthansa will have a strategic stake in SN Airholding SA/NV and, in a second step, the full integration of the Belgian carrier in the Lufthansa Group. The agreement still requires the approval of the regulatory authorities and the Lufthansa Supervisory Board as well as the board of directors and shareholders of SN Airholding SA/NV. In a first step, Lufthansa is taking out a stake of 45 percent in SN Airholding SA/NV for 65 million euros via a capital increase. After securing the air traffic rights of Brussels Airlines, Lufthansa will then have an option of acquiring the remaining 55 percent in 2011. It would then wholly own the Belgian carrier.

The price for taking up the remaining 55 percent depends on performance-related factors so that the cost for complete acquisition of Brussels Airlines could amount to a maximum of 250 million euros. The jointly drafted integration model is shaped along the lines of the successful cooperation between Lufthansa and SWISS: It envisages that Brussels Airlines will operate as a largely independent company in the Lufthansa Group subject to its uniformly formulated targets, strategic guidelines and financial resources. It also stipulates that, after exercise of the option, Brussels Airlines should retain its headquarters and management in Brussels. It will continue operating and developing its strengths under its familiar brand with its own aircraft and crew, and expand its local advantages in the Belgian market. That includes a demand-driven route network including intercontinental connections.

The Lufthansa hubs in Frankfurt, Munich and Zurich will complement the overall services offered to customers in accordance with specific market potential, customers’ preferences and cost structures. The integration is designed to enable Brussels Airlines to operate in a demanding market environment, to develop further, attain its growth targets and raise its profitability, and thereby offer customers and staff better long-term perspectives. Lufthansa Chairman Wolfgang Mayrhuber emphasized that the bundling of strengths was necessary and sensible in order to strengthen competitiveness and overall cost efficiency.

In their joint future, Brussels Airlines and Lufthansa can profit from substantial synergies in respect of earnings and costs, which are likely to rise gradually to a mid-double-digit million euro figure annually within three years of regulatory approval. The airlines in the Lufthansa Group carried 63 million passengers to 208 destinations last year. A total of 5.8 million passengers flew with Brussels Airlines and its partners. Brussels Airlines operates in a network encompassing 62 destinations. The merger will add a further 12 destinations to the Lufthansa network, the number on offer to Brussels Airlines customers will rise by 133. Lufthansa employs around 105,000 employees and operates a fleet of 513 aircraft (consolidated fleet). Brussels Airlines operates a fleet of 49 aircraft with a workforce of about 3,000 staff. For more information, visit www.lufthansa.com.

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