Italy set to grant funds to keep Alitalia afloat: source

[webfact]

Italy set to grant funds to keep Alitalia afloat: source

 

FILE PHOTO: An Alitalia Airbus A321-100 plane carrying Pope Francis for one-day visit to Geneva takes off at the Leonardo da Vinci-Fiumicino Airport in Rome, Italy, June 21, 2018. REUTERS/Stefano Rellandini/File Photo

 

ROME (Reuters) - Italy is set to free up funds for loss-making airline Alitalia on Monday as Rome struggles to find investors to keep it afloat, a political source told Reuters.

 

After a group of potential rescuers backtracked in November, Alitalia is expected to run out of money by the end of the year, putting at risk 11,600 jobs and creating a major headache for the government.

 

The ruling coalition of the anti-establishment 5-Star Movement and center-left Democratic Party (PD) will approve later on Monday an emergency decree to ensure services provided by Alitalia continue regularly, the prime minister's office said in a statement.

 

The decree is intended to unblock an already planned 400 million euro ($441 million) loan, the source said, speaking on condition of anonymity. The funds had previously been linked to the success of November's rescue talks.

 

Alitalia has already received 900 million euros from the government since May 2017, when it was put into special administration following a failed restructuring attempt.

 

It has not repaid that loan or the 150 million euros in interest due on it. Rome and Brussels are in close contract over the provision of further funds, given the EU's rules on limiting state aid to companies.

 

Italian railway group Ferrovie dello Stato, which was in talks with infrastructure group Atlantia and U.S. carrier Delta Air Lines, said in November it was not yet able to form a consortium of rescuers for Alitalia.

 

German airline Lufthansa <LHAG.DE>, which offered a commercial partnership with Alitalia, said it was not prepared to invest in the Italian company.

The government plans to launch a new process for the sale of Alitalia to be completed by May 31, 2020, according to a draft decree seen by the source.

 

The new scheme will give to the three state-appointed administrators the power to reduce the carrier’s workforce and fleet of airplanes, the source added.

 

Industry analysts calculate Alitalia has already burned through roughly 9 billion euros in taxpayers' money.

 

(Reporting by Giuseppe Fonte; Editing by Giselda Vagnoni and Mark Potter)

 

-- © Copyright Reuters 2019-12-03

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[melvinmelvin]

 

If Italy does, it will not be the first time.

In line with EU legislation re state subsidies? Hardly.

 

Normally Italy feels free to close their eyes to EU stipulations she dosn't like.

 

 

[terryw]

Any bail out will almost certainly be illegal under EU competition rules, but I doubt that Brussels will do anything to stop it.

[Burma Bill]

Quote:-

"to keep Alitalia afloat"

So the airline is using airships and flying boats:-

 

[Baerboxer]

9 hours ago, melvinmelvin said:

 

If Italy does, it will not be the first time.

In line with EU legislation re state subsidies? Hardly.

 

Normally Italy feels free to close their eyes to EU stipulations she dosn't like.

 

 

 

Italy feels free to close their eyes to EU stipulations she doesn't like - just like France! 

[Baerboxer]

2 hours ago, terryw said:

Any bail out will almost certainly be illegal under EU competition rules, but I doubt that Brussels will do anything to stop it.

 

Of course they won't. Just like they never stop the French with their illegal subsidies or the tax haven Luxembourg.

[Scott Tracy]

Let it die. Flag carriers competing with low cost carriers never works. Have a look in Milan, Easyjet air force runs it.

[30la]

Why do not you get together with Thai, two companies on the verge of bankruptcy can perhaps form one that is saved!
Name: ALITHAI or THAIALI!????

[melvinmelvin]

57 minutes ago, Baerboxer said:

 

Italy feels free to close their eyes to EU stipulations she doesn't like - just like France! 

 

right,

France is a good runner up, 2nd pr. well deserved

 

[dieter1]

just one of many Italien zombie companies....

the  EU central bank throwing Billions at these zombies with  minus interest rates !

The whole EU is going to be a gigantic zombie enterprise. All these zombies will never be able to  pay back - and everyone know this.

THIS is  the real reason for the strength of the Baht ! It is done by the gigantic money "printing" of the Us and EU central banks.

[GinBoy2]

This is yet another airline basket case thats ready for a bullet in the head to put it out of its misery.

 

I was on a Delta employee conference call earlier this year, where the Alitalia thing came up. Delta was only prepared to buy 10% of it, which was a token gesture I think since no one else was stepping up to buy the rest.

 

The reasons cited were, debt, aging fleet, and what for me at least the most shocking, was the fact that Alitalia ranked 5th of all airlines flights in/out of Italy.

 

As I recall, they ranked; Ryanair, Easyjet, Lufthansa, British Airways, then Alitalia trailed in last.

 

Ultimately for Delta, even though Alitalia in part of Skyteam it doesn't really matter it they live or die, so the idea that Delta will 'fly' in and save them is a pipe dream 

[Pique Dard]

alitalia still exists?