Dear Bob,
I'm afraid that most of pprune's readers could not get the joke "Schwansa", which sounds like "tail" in some Swiss-German dialects, or a specific part of (most) men's anatomy, I wouldn't dare to name here (my mother would have forbidden it).
More seriously, the deal between LX and LH was mainly a matter of 750 millions swiss francs the main share holders should have pumped again into LX.
LH had a very thorough and accurate insight on all LX-figures and operations and it gave Andre Dose a detailed restructuration plan. He was the one who was supposed to advocate that file both at the LX-Board and in Bern, the Swiss Confederation being the main share holder. He apparently convinced nobody and didn't really try hard enough.
In the meantime, William Meaney, the former LX-CCO, did everything he could to bring about a deal with BA and oneworld, hoping to replace Dosé as a CEO. He went that far to succeed in chasing Dosé, that the concessions he made to BA made the deal to collapse six months later.
Two Board directors bear a tremendous responsability in the aborted deals (both with LX and BA): André Kudelski for all his screaming against LH and in favor of BA and Walter Bosch.
The later leaked the BA-deal to all four Swiss-German Sunday newspapers before it was even closed, to counterfight a headline published a day before by the Tages Anzeiger, saying that LX was working on a "Chapter 11" scenario. He is not even concealing the manipulation and speaks freely about it.
In doing so, Walter Bosch killed the deal with LH. The only option left was BA, which led to the stand alone situation we currently know.
Aks me about the faith of a national airline...
