Lufthansa to depart Germany’s DAX benchmark after 32-year stay
- 05 June 2020
Germany’s flag carrier is being removed from the country’s benchmark stock index for the first time since the gauge’s inception more than three decades ago, after travel restrictions aimed at stemming the coronavirus pandemic sent the stock plunging, APA reports citing Bloomberg.
Deutsche Lufthansa AG will be replaced by real estate company Deutsche Wohnen AG in the DAX Index, Deutsche Boerse said in a statement Thursday night. The change will come into effect June 22.
Shares in Lufthansa, which this week agreed to a 9 billion euro ($10 billion) state bailout package, have fallen 38% this year, giving the airline a market capitalization of about 4.9 billion euros. That makes it the 60th largest German company by market value, while the DAX is reserved for the country’s 30 biggest companies.
The first half has been a tumultuous one for the German carrier, with the pandemic all but halting its business. Its massive size -- with operations spanning from catering to maintenance -- meant it has bled cash faster than other airlines. The bailout will inflate Lufthansa’s debt and interest payments, and existing shareholdings will be diluted as the government takes a stake. The company said on Wednesday it will slash employee expenses and look at spinoffs to bolster cash flow.