They are planning a huge expansion in the German market in the coming years. It's currently only the 5th largest airline there with a 5% market share, wheras they are in the Top 3 in most other European markets; the LCC share of the German market is also noticeably low.
Lufthansa once crowed that the LCC model would not do well in Germany; however, by pushing the Germanwings and Eurowings models, they have assisted in eroding any remaining reluctance amongst their "loyal" customers.
And now we have the bizarre sight of LH apparently wishing to prop-up AB in the hopes of averting stiffer competition.