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Lufthansa to split IT unit into three companies

Staff writer |
Deutsche Lufthansa AG said it plans to split its IT unit, Lufthansa Systems AG, into three companies as part of a restructuring to optimize the group portfolio.

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The company said it intends to safeguard the future of the infrastructure business by cooperating with a partner with strong IT expertise as well as specialist know-how in the aviation sector.

The company plans to split Lufthansa Systems into three separate companies - Infrastructure, Airline Solutions and Industry Solutions divisions. The IT unit currently serves about 450 customers.

Under the plan, Lufthansa will transition the Infrastructure division into a partnership with an international IT service provider as part of the Group IT outsourcing process. The company said that an invitation to tender will be announced shortly and it will evaluate the bids received accordingly.

Lufthansa will then contract out its infrastructure services to the new partner as part of a long-term agreement to create growth opportunities for the business and new prospects for the employees. The company plans to finalize the project by the end of 2014.

"The IT infrastructure services market needs a high level of investment because it demands a steady stream of product portfolio improvements and strong, sustained growth. Economies of scale are a key competitive factor. In the future, these are to be achieved by working with a major IT services provider operating on a global scale," Lufthansa said.

The Airline Solutions and Industry Solutions divisions will be retained as independent companies operating within the Lufthansa Group. Lufthansa noted that the Airline Solutions division, with its wealth of airline process optimization expertise combined with highly-specialized IT solutions, has the potential to play an even more important role in the Lufthansa Group than before.

According to Lufthansa, more than 300 airlines worldwide currently rely on the know-how of IT specialists at Lufthansa Systems. The company plans to further increase the proportion of third-party business above the current figure of 70 percent.

Lufthansa said that the industry Solutions is well-placed to continue benefiting disproportionately from the growing market for IT consulting services in Germany. The division's customer base features over 150 companies, from SMEs to DAX multinationals. The company plans to substantially increase third-party business beyond its current share of around 60 percent.

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