Exclusive: Lufthansa draws up 'Plan B' to prevent insolvency - source

[June 24, 2020]  FRANKFURT (Reuters) - Lufthansa <LHAG.DE> has drawn up a plan to prevent an insolvency should a virtual extraordinary shareholders' meeting on Thursday fail to approve a $10 billion government bailout, a company source told Reuters on Wednesday.

Employees of Lufthansa hold a placard reading: " Love Passion Lufthansa" during a protest against planned job cuts of Germany's flagship carrier due to the outbreak of the coronavirus disease (COVID-19), at the Lufthansa Aviation Centre in Frankfurt, Germany, June 24, 2020. REUTERS/Ralph Orlowski

The German government could still get a 20% stake, as originally planned, in two steps without the approval of a shareholders' meeting or billionaire investor Heinz Hermann Thiele, the source said.

Germany could initially get a roughly 10% stake from a capital increase without subscription rights at 2.56 euros per share, the source added. The remaining stake would come from a regular capital increase in which all Lufthansa shareholders could participate.

The person, who is familiar with the plans, cautioned they were not yet coordinated with the government.

(Reporting by Ilona Wissenbach; writing by Thomas Seythal; editing by Edward Taylor and Maria Sheahan)

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