Germany’s national airline Lufthansa has become a shareholder of Latvia’s flag carrier airBaltic, according to information from Firmas.lv.
airBaltic’s share capital has been increased by 16.64 million euros, bringing it to 41,819,525 euros. The changes to the company’s share capital were registered in the Latvian Companies Register on Thursday, the 28th of August.
The increase was made by issuing two new categories of mandatory convertible shares, according to the capital increase rules.
One of the mandatory convertible shares was allocated to airBaltic’s strategic investor – Deutsche Lufthansa Aktiengesellschaft – fulfilling obligations arising from the investment subscription agreement signed on the 29th of January, 2025, between the company and its largest shareholder, the Latvian state. The other mandatory convertible share was allocated to the Latvian state under an investment subscription agreement dated the 20th of August, 2025.
Each newly issued share has a nominal value of 8.32 million euro
and a sale price of 14 million euro.
As a result, airBaltic’s share capital now consists of 251,795,252 ordinary shares with a nominal value of 0.10 each euros, plus two mandatory convertible shares with a nominal value of 8.32 million euros each.
The aim of the capital increase is to secure additional financing for airBaltic and to support its growth plans.
Regardless of nominal value, each mandatory convertible share grants 31,474,410 votes at the shareholders’ meeting, as well as rights to dividends, pre-emptive rights to subscribe for newly issued shares in future capital increases, and pre-emptive rights to acquire convertible bonds in case of such an issuance. Each convertible share is treated as if it represented 31,474,410 ordinary shares.
In addition,
each mandatory convertible share carries the right to receive a liquidation quota
and confers a package of rights as if the holder owned 10% of voting capital and represented 10% of the company’s share capital. These include: the right to request a special audit, to bring claims against founders, board or council members, or the auditor; the right to demand an extraordinary shareholders’ meeting; the right to propose additional agenda items and draft decisions; the right to nominate council candidates; and the right to postpone annual report approval if the accuracy of certain items is disputed, as well as the right to request the council to review the management board’s activities.
If, within 36 months of issuance, airBaltic’s share capital or the number of shares changes, the number of votes and shares represented by each mandatory convertible share will be adjusted so that each continues to represent 10% of the company’s shares and votes then in circulation, according to the capital increase rules.
As previously reported, in 2024 the airBaltic group posted audited losses of 118.159 million euro compared with a profit the previous year, though turnover grew by 11.9% to 747.572 million euros.
In the first half of this year, losses fell sharply to 1.729 million euros,
while turnover increased by 3% to 349.648 million euros.
Until now, the Latvian state owned 97.97% of airBaltic, while financial investor Lars Thuesen’s company Aircraft Leasing 1 held 2.03%.
On the 30th of June, 2025, Germany’s Federal Cartel Office approved Lufthansa’s acquisition of a 10% stake in airBaltic.
Following airBaltic’s planned Initial Public Offering (IPO), Lufthansa Group’s exact shareholding will be determined by the IPO market price. However, the deal foresees that Lufthansa will retain at least 5% of airBaltic’s capital after the IPO.
The Latvian government decided on the 30th of August, 2024, that after the IPO the state must retain no less than 25% plus one share in the airline’s capital.
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