Takeover offer to the shareholders of Austrian Airlines AG

Lufthansa offers EUR 4.49 per share

Lufthansa has submitted a public takeover offer to the shareholders of Austrian Airlines AG through ÖLH Österreichische Luftverkehrs-Holding-GmbH and offered EUR 4.49 per share. The acceptance period for the bid starts on 2 March 2009 and ends on 11 May 2009. The bid price corresponds to the average weighted market price of the Austrian Airlines share over the six months preceding the announcement of the planned takeover bid; the period dates from 3 June 2008 up to and including 2 December 2008. The takeover offer of EUR 4.49 per share is about 69 per cent above the share price on 2 December 2008 and about 30 per cent above the closing price of the share on 26 February 2009. The full offer document can be viewed at www.lufthansa.com/austrian.

The offer represents a further step on the way to the complete takeover of Austrian Airlines by the Lufthansa Group. The Supervisory Boards of Deutsche Lufthansa AG and Österreichische Industrieholding AG (ÖIAG) had previously approved the purchase of the shares and the integration of Austrian Airlines AG into the Lufthansa Group. The corresponding agreements were signed on 5 December 2008. Within the framework of these contracts, the parties also agreed on Lufthansa’s acquisition of the 41.56 per cent share in Austrian Airlines AG held by ÖIAG. The share package will be acquired at a price of EUR 366,000 plus an earn-out option. With the earn-out option, Lufthansa will pay ÖIAG a sum of up to EUR 164 million depending on Austrian Airlines’ future economic performance and the Lufthansa share outperforming its competitors.

In the future, the Austrian Airlines AG shares will be held by the Austrian company, ÖLH Österreichische Luftverkehrs-Holding-GmbH, 50.2 per cent of which is owned by ÖLP Österreichische Luftverkehrs-Privatstiftung and 49.8 per cent of which is owned by ÖLB Österreichische Luftverkehrs-Beteiligungs-GmbH, a 100 per cent subsidiary of Lufthansa. The completion of the transaction is subject, inter alia, to the conditions precedent of anti-trust approval and the approval of a EUR 500 million restructuring grant to be made by the Republic of Austria, both of which must be granted by the European Commission.

The European aviation industry is undergoing a fundamental process of change and consolidation. The aim behind the integration of Austrian Airlines in the Lufthansa Group is to consolidate the strengths of two airlines in order to sustainably strengthen the competitiveness and overall profitability of the partners in the Group. In the future, Austrian Airlines will be in a position to benefit from the economies of scale, market presence and competitive strength of Lufthansa. The integration into the Lufthansa Group’s multi-hub system will make the route network more attractive for both partners’ customers and secure the connection of Vienna to other European and intercontinental business locations. The essential factors of the integration are that the “Austrian” brand shall be preserved and Austrian Airlines shall remain an independent airline with its head office in Austria.

Deutsche Lufthansa AG
Corporate Communications

This press release does not contain all information about the takeover offer addressed to the shareholders of Austrian Airlines AG. Persons who intend to accept the takeover offer to acquire shares in Austrian Airlines AG should make such decision only on the basis of the entire offer document which was published on 27 February 2009 and which can be downloaded free of charge at www.lufthansa.com/austrian. This press release and the information contained herein is not being released in the United States of America (the “USA”), in Australia or Japan and may not be distributed in these countries.