Lufthansa Seeks Partner for Infrastructure Services Department

Deutsche Lufthansa AG (LHA), Europe’s second-largest airline, is seeking a partnership that would cut its information technology unit almost in half as it seeks to reduce costs.

The carrier wants “a large international company to partner with” for the infrastructure services portion of its Lufthansa Systems unit, spokeswoman Sandra Hammer said today in an e-mailed statement. The infrastructure portion of the business, which operates computer centers, has about 1,300 of the IT unit’s 2,800 employees.

Lufthansa will emphasize that any future partner should safeguard most jobs, and the Oct. 22 decision by the company’s board has been communicated to employees and labor representatives, Hammer said. German news agency DPA reported the news earlier.

Partnering with IT services companies such as Deutsche Telekom AG (DTE)’s T-Systems unit or International Business Machines Corp. (IBM) is conceivable, while no partner has been selected yet, Hammer said. The infrastructure business needs to be bigger to compete with rivals, she said.

Chief Executive Officer Christoph Franz has frozen the aircraft fleet and is cutting more than 3,500 jobs and moving parts of Lufthansa’s revenue services operations abroad to slash costs for a goal of lifting operating profit to 2.3 billion euros ($3.2 billion) by 2015.

Lufthansa said on Oct. 22 that currency fluctuations, lower air-freight prices and restructuring costs mean that operating profit this year will amount to no more than 700 million euros, 24 percent lower than the average analyst estimate collected by Bloomberg at the time. The potential changes at the IT unit weren’t part of the original efficiency program, and the unit is still due to contribute 35 million euros in additional operating profit by 2015, Hammer said.

The infrastructure services unit has its most important sites in London, Dallas and Singapore, as well as Budapest, Buenos Aires and Flensburg, in Germany. Lufthansa Systems is headquartered in Kelsterbach, adjacent to Frankfurt airport.

To contact the reporter on this story: Richard Weiss in Frankfurt at rweiss5@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.