Italy puts ITA-Lufthansa deal on hold due to price dispute, sources say

ROME/FRANKFURT (Reuters) -Italy's Treasury has put on hold the sale of a minority stake in ITA Airways to Lufthansa because of a dispute with the German carrier over the agreed price, two sources familiar with the matter said on Tuesday.

An Italian source said the Treasury would not "undersell" ITA.

Lufthansa in July won EU antitrust approval to buy 41% of state-owned ITA, the successor airline to bankrupt Alitalia, for 325 million euros ($354 million), in a deal designed to boost its presence in the lucrative southern European market.

The Italian economy ministry and Lufthansa are arguing over a difference of 10 million euros, a second source said, confirming an earlier report by Italian daily Corriere della Sera.

The source said the eventual price would depend on the value of a second stake expected to be sold a few years after the initial 41%.

Both sources asked not to be named because they were not authorised to speak publicly on the issue.

A spokesperson for Lufthansa said the company would adhere to the terms of the contract for its investment in ITA, adding that the airline had signed an offer on remedies.

The offer - needed to secure EU antitrust approval for the deal - included ceding flight slots to rivals.

It was due to be submitted to the European Commission on Monday, but was not sent to Brussels because of the disagreement over the price, one of the sources said.

($1 = 0.9175 euros)

(Reporting by Giuseppe Fonte in Rome and and Ilona Wissenbach in Frankfurt, writing by Alvise Armellini, editing by Giulia Segreti, Kirsten Donovan and Barbara Lewis)