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Lufthansa acknowledges talks with SAS management

Germany's leading airline Lufthansa has been in talks with its troubled Scandinavian counterpart SAS, a company executive told Danish media Friday, rekindling speculation about a planned acquisition.

Published: 2 January 2009 16:59 CET

Lufthansa acknowledges talks with SAS management

Photo: DPA

A senior Lufthansa executive, Karsten Bentz, refused to comment on rumours that the German airline is eying SAS for purchase, but daily Jyllands-Posten cited him as saying that there were frequent talks between the two.

“After the German and the Italian markets, the Scandinavian market is the most important for Lufthansa,” he said. “We want to take an active part in the consolidation that is taking place in the European airline industry, and that subject is often the focus of Lufthansa management meetings,” he added.

At the end of November, a Lufthansa spokeswoman reaffirmed the company’s interest in taking over SAS, but Friday’s interview marked the first time an executive has acknowledged official talks between the two groups.

SAS meanwhile saw its share price soar 13.46 percent in afternoon trading on the Stockholm stock exchange, which was up 3.26 percent, apparently in response to Standard & Poor’s raising its rating for the group from “hold” to “strong buy,” according to Dow Jones Newswires.

The German airline has long been mentioned as a rescuer for SAS, a partner in the Star Alliance, and in September, analysts said it was possible Lufthansa would make an offer for the Scandinavian company.

Sweden's SSAB to build €4.5bn green steel plant in Luleå

“The transformation of Luleå is a major step on our journey to fossil-free steel production,” the company’s chief executive, Martin Lindqvist, said in a press release. “We will remove seven percent of Sweden’s carbon dioxide emissions, strengthen our competitiveness and secure jobs with the most cost-effective and sustainable sheet metal production in Europe.”

The new mini-mill, which is expected to start production at the end of 2028 and to hit full capacity in 2029, will include two electric arc furnaces, advanced secondary metallurgy, a direct strip rolling mill to produce SSABs specialty products, and a cold rolling complex to develop premium products for the transport industry.

It will be fed partly from hydrogen reduced iron ore produced at the HYBRIT joint venture in Gälliväre and partly with scrap steel. The company hopes to receive its environemntal permits by the end of 2024.

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The announcement comes just one week after SSAB revealed that it was seeking $500m in funding from the US government to develop a second HYBRIT manufacturing facility, using green hydrogen instead of fossil fuels to produce direct reduced iron and steel.

The company said it also hoped to expand capacity at SSAB’s steel mill in Montpelier, Iowa.

The two new investment announcements strengthen the company’s claim to be the global pioneer in fossil-free steel.

It produced the world’s first sponge iron made with hydrogen instead of coke at its Hybrit pilot plant in Luleå in 2021. Gälliväre was chosen that same year as the site for the world’s first industrial scale plant using the technology.

In 2023, SSAB announced it would transform its steel mill in Oxelösund to fossil-free production.

The company’s Raahe mill in Finland, which currently has new most advanced equipment, will be the last of the company’s big plants to shift away from blast furnaces.

The steel industry currently produces 7 percent of the world’s carbon dioxide emissions, and shifting to hydrogen reduced steel and closing blast furnaces will reduce Sweden’s carbon emissions by 10 per cent and Finland’s by 7 per cent.

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