Lufthansa has crashed out of the prestigious DAX Index after a 32-year run, according to a statement released by Deutsche Boerse. The change will take effect on June 22, at which point the residential property fund Deutsche Wohnen AG will replace it. The writing was on the walls once the company accepted a €9bn bailout package from the German government in return for giving up a 20 percent share in the company. This gave it a market value of €4.9bn, which is good enough only for 60th place in terms of market value among German companies. The DAX Index tracks the country’s top 30 companies. Lufthansa has been brought down to Earth by the coronavirus pandemic, with its very size proving a disadvantage as it’s been bleeding cash since March. Its financing costs have sent its debt levels and costs skyrocketing, while existing shareholders watched their stakes be diluted as the German state took control of the new shares. Employee expenses are going to be slashed, according to a statement earlier this week from the company and it will look to produce cash by selling off portions of the company. Its aircraft maintenance division is one potential spinoff being looked at.
