Lufthansa's Supervisory Board has refused to accept a recently agreed EUR9 billion euro (USD9.9 billion) bailout adding that it would not convene a necessary Extraordinary General Meeting of shareholders due to concerns over the European Union's demand for the release of slots.

"The Supervisory Board has taken note of the conditions currently indicated by the EU Commission. They would lead to a weakening of the hub function at Lufthansa's home airports in Frankfurt Int'l and Munich. The resulting economic impact on the company and the planned repayment of the stabilization measures, as well as possible alternative scenarios, must be analyzed intensively," the board said in a brief press release.

The board underlined that it continues to see the bailout as the "only viable alternative for maintaining solvency".

The bailout package consisting of EUR5.7 billion (USD6.3 billion) in repayable fresh equity, EUR300 million (USD330 million) in equity converted into a 20% stake, and EUR3 billion (USD3.3 billion) in loans, was approved by the German government on Monday. It has yet to be approved not only by the board and shareholders of Lufthansa but also by the European Commission, which is the highest antitrust authority in the EU.

Bloomberg reported earlier, citing unofficial sources, that the European Commission would likely demand that Lufthansa vacates some of its slots at Frankfurt and Munich airport in return for the aid. The Commission has yet to take a formal stand regarding the transaction.