The German Government has passed a new Bill, proposed by transport minister Matthias Wissmann, aimed at clearing the way for a full privatisation of the national airline Lufthansa.
The airline group says that its shares could be available on the stock market this year once the new legislation is approved by parliament. The Government began privatisation in 1994 when it reduced its stake from 51% to 36%, after helping to capitalise the airline's state-run pension scheme. The Government's remaining stake is now estimated to be worth in the DM3 billion.
The new law, which should come into force on 1 July, proposes measures to ensure that the airline continues to be majority-owned by German shareholders - as required under air bilaterals. The law, which will eventually apply to all German airlines, means that carriers will only issue "bearer shares", that identify the names and nationalities of the holders, allowing the company to keep a register of its ownership structure.
Lufthansa currently has 20% foreign ownership. If this rises above 40%, the new law will give the airline the right to buy back shares. From 45%, the airline will be able to issue new shares without offering existing shareholders first refusal. If foreign ownership exceeded 50%, the law allows the company to force shareholders to sell shares at their original purchase price, or to declare the shares void. The rules will only apply to shares which are purchased after the law comes into force and on a "last in, first out" principle.
Source: Flight International
