Lufthansa and Italy have sought EU antitrust approval for the German airline to buy a controlling minority stake in Italy’s ITA Airways, with sources saying that Lufthansa is prepared to cede slots at Milan airport to address competition concerns.

Lufthansa will acquire a 41% stake in ITA for €325m as part of a capital increase, a Lufthansa company spokesperson said.

This followed an agreement in June between the Italian Ministry of Economy and Finance (MEF) and Lufthansa on the minority stake buy. The deal also contains options that enable Lufthansa to take over remaining shares in ITA at a later date.

Once EU approval is secured, ITA Airways and Lufthansa Group will immediately begin collaboration at a commercial and operational level, the spokesperson said.

The Italian Treasury said it made a joint request with Lufthansa for approval of the deal.

The European Commission will decide by January 15 whether to clear the deal, according to a filing on its website.

It can either clear the deal with or without remedies after the preliminary review or open a four-month long investigation if it has serious concerns.

Lufthansa and ITA Airways could hand over take-off and landing rights at Milan-Linate Airport, sources told Reuters.