‍DALLAS – A breakthrough in Lufthansa’s (LH) merger with ITA Airways (AZ) came about on Monday night. Talks between the Italian Economy and Finance Ministry (MEF) and LH moved ahead after reaching a solution to a problem that had stalled the German company's merger with AZ.

Italian media reported that the deal was delayed last week when LH requested a discount of €10 million (US$10.65 million) on the €325 million (US$345 million) purchase price of a 49% stake in AZ.

The German airline had requested a discount based on AZ's expected drop in value in the last quarter of 2024.

However, Italian Finance Minister Ginacarlo Giorgetti said that there had been no change to the original agreement. "The economic conditions envisaged have not changed with respect to the agreement already signed," his office said in a statement.

As a result of the breakthrough, the documents for the deal have been signed and sent to the European Commission for final approval.

According to an agreement reached last year, LH is acquiring a 41% stake in ITA from MEF through a €325-million (US$345 million) capital increase. The stake will rise to 100% in a second phase—by 2033—for a total investment of €829 million (US$880 million).

The MEF owns AZ, which replaced the former flag carrier Alitalia in 2021.

The deal still needs to be cleared by the European Commission, which set a series of conditions for the sale in June, including the requirement to cede take-off and landing rights to competitors.

ITA was created in 2020 after Alitalia, Italy's former flag carrier, faced serious financial difficulties. The airline employs just under 4,900 people.

In July, the EU Commission said, "ITA's long-term sustainability as a stand-alone carrier would have remained highly uncertain absent the deal.”