Berlusconi wants to give a loan to Alitalia, is that allowed by the EU? I thought this kind of preferential treatment was forbbiden

Hi,

I think the issues about the loans that have been mentioned are outlined in the linked articles; I do not think it is strictly forbidden, but there would be limits to the amount and duration of the loan, and there would be very strict conditions attached. I think there is talk of a bridging loan that is to be discussed tomorrow by the current government.

However, the new government does not come into power until next month and the airline may not last that long if the creditors call it a day, or it loses its operator's license for instance. Now that share trading has been suspended it is also possible that the airline will be sold shortly at a knocked down price.

About the cabinet meeting later on the 22nd:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a3k2mbg9lw9I

EU says to review Alitalia emergency aid quickly

BRUSSELS, April 23 (Reuters) - The European Commission said on Wednesday it would assess quickly whether Italy's decision to grant ailing airline Alitalia a 300 million euro ($479 million) loan broke European Union state aid rules. "The Commission has been able to prove that when assessment and measures to be assessed are really urgent, the Commission has always been acting with the necessary urgency," a spokesman for the European Union's executive arm told a regular briefing.

Italy's outgoing centre-left government decided late on Tuesday -- in consultation with Silvio Berlusconi, who becomes prime minister next month -- to provide the emergency loan to keep the airline flying.

"The Italian government has clearly stated its intention to give this loan -- at this stage we haven't received notification," the Commission spokesman said, declining further comment on whether the EU executive would permit the loan.

Under EU rules, state aid to companies is forbidden except under certain conditions.

The Commission denied there would be a conflict of interest if it appointed an Italian to be its next transport commissioner -- a job that would include overseeing the EU executive's dealings with Alitalia.

Commission President Jose Manuel Barroso announced the potential reshuffle on Tuesday in the event that Italy's Franco Frattini quits his post as EU justice and security commissioner to join the Berlusconi cabinet, as expected.

"This doesn't take anything away from the fact that the Commission takes decisions as a college," another Commission spokesman said.

It is now up to the EU Commission to decide if the loan is legal:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=asMOeiUpiUu0

... but no matter, the new Government gets to appoint the new EU Transport Commissioner:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=axaJV1MQusS8

... so it's carry on regardless.

It is now up to the EU Commission to decide if the loan is legal:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=asMOeiUpiUu0

... but no matter, the new Government gets to appoint the new EU Transport Commissioner:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=axaJV1MQusS8

... so it's carry on regardless.

Commissioners get a really tough examination by the Parliament when acceding to power, so even if he is Italian he will act objectively, otherwise if there is suspicion he's going to be partial he probably won't be let to get the chair, and if he has arrived to power and then favours Italy he would be forced to resign, so don't worry about that.

Commissioners get a really tough examination by the Parliament when acceding to power, so even if he is Italian he will act objectively, otherwise if there is suspicion he's going to be partial he probably won't be let to get the chair, and if he has arrived to power and then favours Italy he would be forced to resign, so don't worry about that.

I agree it will not be as bad as I made it out to be; it is more a lucky convergance of events for Berlusconi than a contrivance to have one of his political side-kicks in the role. However, I do not share your confidence in the EU establishment, and I have no doubt that a way will be found to bail-out Alitalia even if it does break EU rules.

It is now up to the EU Commission to decide if the loan is legal:

If it is really a loan, it's legal.
Nobody (especially EU commisares who are not elected by people) can blame Italian government when it tries to save it's national airline.
Berlusconi should buy Alitalia with his own money instead of asking it to others Italian investors.

If it is really a loan, it's legal.
Nobody (especially EU commisares who are not elected by people) can blame Italian government when it tries to save it's national airline.
Berlusconi should buy Alitalia with his own money instead of asking it to others Italian investors.

Government loans are not legal unless they comply with EU regulations.

I think it is the Italian Government that allowed the airline to get in a mess in the first place, and it is anti-competative if the governement supports a failed state (now semi-state) owned business were as private sector companies have to fend for themselves.

Preserving state airlines is out of date thinking and prevents the formation of large scale, low-cost airlines in Europe.

The reality is the industry has evolved to the point where putting money behind a loss-making state carrier is no longer acceptable, and that there have been several major consolidations across the continent (Lufthansa-Swiss, Air France-KLM).

There have been several major consolidations across the continent (Lufthansa-Swiss, Air France-KLM).
Some observers think that only 3 historical airline groups will remain in western Europe in the futur: LH, AF and BA. This is not acceptable for Italian and Spanish governments: all countries want to keep their national airline.

Some observers think that only 3 historical airline groups will remain in western Europe in the futur: LH, AF and BA. This is not acceptable for Italian and Spanish governments: all countries want to keep their national airline.

I think market forces will prevail over Old Europe ideas. All of the EU airlines are going to find it extremely difficult under the current economic conditions with even the financially sound airlines possibly having their profits wiped out with oil at $120 (and up) per barrel. Airlines are still reporting that load factors are good, but their operational costs are escalating and will have to be passed on to the customer. It is likely that more routes will become uneconomical for their current operators resulting in the withdrawal of services if the financial drain is not to become unbearable. The winners/survivors are the ones that can respond quickly and minimise the impact on customers through cost reductions. EU Governments are not allowed to bail-out failed airlines with financial aid so they will need to subject themselves to the forces of the open market (financial and competitive). We should therefore now expect to see a very aggressive air-travel market develop in the EU with many of the struggling airlines going to the wall faster than Governments can save them, and some varying degrees of retrenchment by the high-cost carriers. That does not mean that certain EU Governments will not band together within the EU establishment, as they tend to do, to manipulate EU decisions to protect their vested interests, but they will encounter legal opposition to this from the large privately owned airlines and so are unlikely to get it all their own way.

Many 'national carriers' could survive but in a different form (such as Sabena, Swiss, AerLingus) with a move away from premium, international, to low-cost, regional operations. However, they will find it increasingly difficult to survive in a low-cost carrier market dominated by the likes of easyJet and Ryanair whom would seem to benefit from their economies of scale and whom are very aggressive in the application of EU regulations to open local markets.

Even the top-tier airlines will find it difficult; for example Lufthansa's debit is now only one level above junk status, so it will be very expensive for it to borrow money should it find it needs to (this was a factor in it's decision not to bid for Alitalia). Instead Lufthansa may need to cut back its costs, re-trench from un-profitable routes and abandon (or put-aside) its current expansionist policies. Iberia tried to sell itself last year and would make a good fit with any of the big three EU combines or with SAS say to form a middle-tier airline. AF/KLM has already indicated that it will have to cut back on French internal flights (in its case it is losing out to the railways and market forces), and will probably need to review its international operations. BA is pretty savvy, but it could also disappear in a consolidation take-over (say with a US or Middle-Eastern airline) with it being the only private EU major airline that does not have a significant government holding.

I am not sure however that we will be left with only three big carriers, nor that those big operators will all offer premium services. EU citizens would benefit from a major business driven consolidation to reduce costs and to integrate services. Also, the changes to EU regulations governing who can fly and from where will bring competition into previously protected markets. Heathrow is an obvious target, but so too are the struggling airlines, whom are likely to become subject to predatory competition to eliminate them from the market (such as Lufthansa/Swiss vs. Alitalia in northern Italy). The problems are that there are many small airiness of various types in Europe, and it would take a considerable period time for consolidation to make a significant impact. There will also be resistance from some Governments to preserve National Carriers (it just so happens that it was the same Governments that were in favour of the EU Constitution which seems some what contradictory given that consolidation of businesses across Europe is the natural outcome of an integrated Europe). Fortunately these protectionist policies are now more difficult and expensive to enforce than before.

So back to Alitalia. No buyer has made a commitment to take control, and even Berlusconi has now acknowledged that there will have to be major restructuring and job losses if it is to survive. The market situation however is moving very quickly and is undermining evaluations of the company's worth made by auditors even as recently as at the time of the election. All business-driven offers for the airline lapsed some time ago (that of AF/KLM being undermined by the new PM in addition to the changing market conditions and union opposition), and so any take over will most likely have to be accompanied by a financial sweetener of some sort, such as the right-off of debit, transfer of pension scheme or some other inducement plus the removal of all locally imposed conditions on the new owners. This would be very difficult under EU regulations, and so the Italian Government itself may have to initiate the moves to clean up the airline before Alitalia can be sold possibly resulting in industrial action. All this is losing time, and reducing the options open to the airline.

Alitalia's immediate future is probably as a middle to low-cost regional and local carrier, with some premium international services. Rome is likely to be its only major operational base, and its market share is likely to be reduced from its current 44%. Once it is fully private and in a 'healthy' condition, it is likely to be bought up by one of the large combines and turned into a local airline in name only (trading names for local markets will probably be a growing trend as with the railways say in the UK).

So on to the next EU National Carrier to run into difficulties. Olympic would be a good candidate, possibly TAP, or one of the airlines from the newer Eastern countries such as LOT. What is interesting about the difficulties that Alitalia has gotten into, is to see how the EU will react to the issues. The new Italian EU Transport Commissioner will no doubt distort how Alitalia is seen to be treated, and so Alitalia will have repercussions for the EU's current and future policy on air travel.

^^
Olympic is already the next one with the struggle between the governement of Greece and the EC.

If it is really a loan, it's legal.

It depends on the terms of the loan, surely the government couldn't just give the airline €x00m at 0% interest with no payments due until 2015.

Some observers think that only 3 historical airline groups will remain in western Europe in the futur: LH, AF and BA. This is not acceptable for Italian and Spanish governments: all countries want to keep their national airline.

I haven't heard any complaint of the spanish government about a possible takeover of Iberia by another foreign-owned carrier; I think the reason for which Iberia is not being courted is that, unlike Alitalia, it is profitable and it's not a bargain so it's only worth being bought for strategic reasons. BA was said to be interested, but nothing is official yet.

Even the top-tier airlines will find it difficult; for example Lufthansa's debit is now only one level above junk status, so it will be very expensive for it to borrow money should it find it needs to (this was a factor in it's decision not to bid for Alitalia). Instead Lufthansa may need to cut back its costs, re-trench from un-profitable routes and abandon (or put-aside) its current expansionist policies. Iberia tried to sell itself last year and would make a good fit with any of the big three EU combines or with SAS say to form a middle-tier airline. AF/KLM has already indicated that it will have to cut back on French internal flights (in its case it is losing out to the railways and market forces), and will probably need to review its international operations. BA is pretty savvy, but it could also disappear in a consolidation take-over (say with a US or Middle-Eastern airline) with it being the only private EU major airline that does not have a significant government holding.AF/KLM profits are twice more important ($1.15 billion) than those of BA ($550 million). BA has known a 30% drop of its profits in 2007. AF/KLM generated $30 billion of revenues in 2007 compared with $25 billion for LH and $16.5 billion for BA.

The CDG airport platform has been vastly improved recently, thanks to the opening of the S3 satellite, the re-opening of Terminal 2E and the opening of the 2 new automatic metro shuttles making CDG much better for passengers to navigate in. The traffic forecasts for CDG airport are good. There's actually no reason to doubt Air France/KLM will remain the airline generating the most revenues worldwide in the upcoming years.

I wonder what's the influence of the expensive euro on airlines. It should make continental European airlines more competitive thanks to cheaper oil, however, it also makes the workforce more expensive. I have no clue what has the bigger impact on the market.

As for French domestic flights. The passengers decrease is a long-term trend which is taken into account since a long time. Air France continues to make travel more people every year despite the opening of the Paris-Marseille and Paris-Strasbourg TGV lines. International flights represent by far the major part of AF/KLM traffic.

^^
Olympic is already the next one with the struggle between the governement of Greece and the EC.

Yes that's right. I am not up to date with what is happening with Olympic; its 'transformation' seems to have been dragging on for some years now. Do you have an update?

I think TAP is not far behind.

I think TAP is not far behind.

What do you mean when you say TAP is not far behind?

TAP is gradually becoming an example on how to recover from ashes a legacy airline. The CEO Fernando Pinto is doing an excellent job on TAP.
There's no comparison with Olympic or Alitalia.

TAP even tryed to buy VARIG last year to prevent what ended up to be the death of the great airline VARIG was.

Next year problably TAP will be sold not as an ill company but as a very important airline linking Europe to South America and Africa!!

... I think TAP is not far behind.

What do you mean when you say TAP is not far behind?

TAP is gradually becoming an example on how to recover from ashes a legacy airline. The CEO Fernando Pinto is doing an excellent job on TAP.
There's no comparison with Olympic or Alitalia.

TAP even tried to buy VARIG last year to prevent what ended up to be the death of the great airline VARIG was.

Next year probably TAP will be sold not as an ill company but as a very important airline linking Europe to South America and Africa!!

Yes, I stand corrected. My comment was based on out of date information, and as you say, TAP has undergone a very impressive turn around (http://www.flytap.com/USA/en/Company/Press/PressReleases/7045).

The number of awards it has been receiving, and the growth in it's South American and European services, along with the moderate but sustained profitability are good indicators.

It could survive as a privatised independent if it can service, in a climate of higher fuel costs and open skies, the increased level of debt that has been used to fund the expansion.

So even though it is not ill like Alitalia, it is still likely as you say to be taken over after it eventually moves out from under the protection of state ownership.

The existing EU Transport Commisioner has questioned the legality of the loan made by the Italian Governemnt to Alitalia, and has given the Government until the 19th May to publish the details of the loan:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=axypktIk1xPs

Berlusconi says that renationalisation is not an option, but instead that Italian businesses will step in to save the airline. I wonder if they are having their arm's twisted:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aPuYXf1UXnAA

It would also appear that the EU Commission is already back-sliding.

Also on the BBC:
http://news.bbc.co.uk/1/hi/business/7398163.stm

The Italian Antonio Tajani, takes over as EU Transport Commissioner:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aQIOeeOWjhJg

Emirates denies interest in Alitalia

DUBAI, May 23 (Reuters) - Dubai airline Emirates [EMAIR.UL] said on Friday it was not interested in participating in a possible bid for Italy's struggling Alitalia , contrary to the latest newspaper reports.

"We are not interested," an Emirates spokeswoman said. "We are focused on our own organic growth."

Early on Friday, Italian dailies Corriere della Sera and Il Messaggero cited market rumours that Emirates was in touch with a group of investors being brought together by an advisor to Prime Minister Silvio Berlusconi for a possible bid.

The adviser, Bruno Ermolli, is working on a rescue plan for Alitalia which would involve a group of investors buying into the airline, which the government has repeatedly failed to sell.

Emirates' name has popped up in the Italian press in the past as a possible investor in Alitalia and last September it denied reports it could invest in the airline along with a group of African banks, U.S. and Chinese funds and an Italian partner.

Emirates denies interest in Alitalia

DUBAI, May 23 (Reuters) - Dubai airline Emirates [EMAIR.UL] said on Friday it was not interested in participating in a possible bid for Italy's struggling Alitalia , contrary to the latest newspaper reports.

"We are not interested," an Emirates spokeswoman said. "We are focused on our own organic growth."

Early on Friday, Italian dailies Corriere della Sera and Il Messaggero cited market rumours that Emirates was in touch with a group of investors being brought together by an advisor to Prime Minister Silvio Berlusconi for a possible bid.

The adviser, Bruno Ermolli, is working on a rescue plan for Alitalia which would involve a group of investors buying into the airline, which the government has repeatedly failed to sell.

Emirates' name has popped up in the Italian press in the past as a possible investor in Alitalia and last September it denied reports it could invest in the airline along with a group of African banks, U.S. and Chinese funds and an Italian partner.

This was just one of the many rumours being put about by the Il Messaggero newspaper, none of which have been substantiated.

If it can be substantiated, then it won't be a rumour :)

If it can be substantiated, then it won't be a rumour :)

Well I think that the article you posted clear shows that Emirates interest was no more than a rumour. In all the original reporting, the newspaper was unable to say were it got it's information from.

Italian government hopeful Alitalia won't fail

ROME, May 28 (Reuters) - Italian Prime Minister Silvio Berlusconi will make good on a pledge to find an Italian buyer for ailing airline Alitalia to help it avoid bankruptcy, a senior government official said on Wednesday.

"We're waiting confidently. If Berlusconi says that there is a buyer, I believe him," said Roberto Castelli, undersecretary in charge of transport at the Infrastructure Ministry.

Alitalia on Tuesday reported a 2007 loss of 495 million euros ($778.3 million) and reiterated it needed fresh capital quickly to keep flying.

The government on Wednesday officially converted a 300 million euro emergency loan to the carrier into an asset on its books, providing it with a lifeline.

The government has said the move is temporary. It is designed to win the approval of auditors for the airline's precarious finances.

The airline has warned that it now needs a further, urgent, injection of funds:
http://news.bbc.co.uk/1/hi/business/7423113.stm


This is before the EU Commission has even authorised the recent 300 million Euro loan, on which it has already said it "may be illegal". The Italian Government has until tomorrow (30th May) to give the necessary details of the loan which it has so far failed to do:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aal256HkH5e0


The airline has also failed to publish its accounts, though this could be due to confidential negotiations over the residual value of the company:
http://news.bbc.co.uk/1/hi/business/7420774.stm


However the further request for funds may scupper any realistic bid, with there still only being unconfirmed reports of a rescue plan:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=azuK1kpBqb1A

Gov't: Alitalia has enough funding for a year
29 May 2008

MILAN, Italy (AP) - Emergency funding of $467 million granted to the state-controlled airline Alitalia should keep it flying for another year, the Italian government said Thursday.

The statement was made in a document accompanying a decree to convert the government's 300 million euro loan into capital.

The European Union has warned that Rome's bridge loan may violate EU competition rules on state aid if it cannot be proven the airline would have been able to obtain the money from a commercial lender. The EU set a Friday deadline for Italy to supply information on the loan.

The fate of the airline has been unclear since Air France-KLM walked away from a deal. Premier Silvio Berlusconi, who opposed the Air France-KLM deal and promised to keep Alitalia in Italian hands, has pledged to come up with a group of investors to relaunch the airline with an industrial partner. However, no commitments have been announced.

The airline, which is 49.9 percent owned by the government, posted a 2007 loss of 495 million euros ($780 million) and issued an urgent appeal for new capital Tuesday.

It acknowledged in a statement that a lack of a concrete plan was hurting its credibility.

The airline is losing 2 million euros (more than $3 million) a day.

Italian Government now going for a fire sale:
http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKL307538820080530

^^

Tremonti also defended his decision this week to turn a 300-million euro government loan to the airline into company capital, saying it was the only way to prevent it from going bankrupt or being put under special administration.

huh?? :? does it mean the company is being given 300 million euros for free? that would break the EU rules for sure

^^

huh?? :? does it mean the company is being given 300 million euros for free? that would break the EU rules for sure

Yep. See my previous posts on this thread about the EU Commission's stance. Today was the deadline for the details to be supplied to the EU Commission. Meanwhile, on the same day, the Italian Government has turned the loan into Capital so that the accounts can be signed off, and that is before the Commission has given the OK. So what happens then if the Commission says that it was illegal and the money has to be repaid? Looks like there is a bit of a kafuffle brewing.

Also, see the post about the new EU Transport Commissioner, who will have to decide on this issue, being appointed by the man (Berlusconi) who is trying to off-load Alitalia onto Italian businesses that are probably having their arm's twisted to investing in a company that is dead on its feet.

^^
huh?? :? does it mean the company is being given 300 million euros for free?
It is a loan that Alitalia will have to pay back in the futur.

It is a loan that Alitalia will have to pay back in the futur.

Yes it was made as a loan, but it will be illegal unless the EU Commission says otherwise. The money loaned to the company was then used to bolster the capital of the company so that it could continue to operate legally and as a prerequisite to the accounts being signed-off.

At present, Alitalia is getting preferential treatment over privately owned airlines operating in the Italian market which is anti-competitive.

I don't know...a collapse and afterwards a fresh start might be just what the Italian aviation industry needs. Just look at Swissair -> Swiss and Sabena -> Brussels Airlines. This way they can probably also get rid of all their unions, who are one of the main reasons Alitalia is unprofitable right now.

I don't know...a collapse and afterwards a fresh start might be just what the Italian aviation industry needs. Just look at Swissair -> Swiss and Sabena -> Brussels Airlines. This way they can probably also get rid of all their unions, who are one of the main reasons Alitalia is unprofitable right now.

You are probably right.

Alitalia's main Italian competitor is to move into the long-haul market:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aNvuPuGNd3Dg


... while BA sticks the boot in:

"It's very clear to us that this is a case of state aid -- everyone sees it that way. We're against it. It's an issue of credibility for Europe, certainly for the commission."

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=axCd03QCuAG8

"Six of Europe's leading airlines have joined together to press the European Commission's transport commissioner to oppose the Italian government's recent financial bailout of Alitalia ..."
http://www.uk-airport-news.info/heathrow-airport-news-080608.htm

Alitalia is give a further month by the EU to supply more relevant information about the 300 Million Euro loan:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aUv.A4YQTvaI


Unless the Italian Government is more forthcoming with the EU, the EU inquiry into the loan will likely find that it was illegal state aid:

"As Alitalia has already benefited from rescue and restructuring aid (in 2001), Italy cannot, in principle, grant it any more aid."

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=arJEyhL2vQ0s


However, it may be relevant to ask why the EU has decided to be lenient on the Italian Government when the latter failed to provide full details in advance of making the loan to Alitalia as it is required to do, and then failed to provide the details by the May deadline. Is it anything to do with the EU Transport Minister being a member of the Italian ruling party?

The EU Commissioner would be unable to stop the process, but he may be acting to buy time for the Italian Government so that it can arrange a fire sale at a knock down price, and then deal with the issue of the loan afterwards. The 300 Million Euro loan was used to meet the company's legal capitalisation obligations before the accounts could be approved, and so is not available for operations as the article may suggest.

The Italian Government therefore has to act very fast since, based on previous statements of the company's available funds, and its rate of consumption of those funds, Alitalia is likely to go bust by the end of June unless there is a further cash injection. However, the opening of the EU inquiry will now make it harder to finalise any agreement with a potential buyer, if there are any, since they would likely have to repay the loan and take on the obligation themselves plus fill the hole in the operating funds. There is also now the risk of legal action from Alitalia's competitors.

Meanwhile the airline's PAX figures for April 2008 dropped by 26% (down 13% in 2008 Q1) with the load factor down 10%. The airline made cuts recently in unprofitable routes, mainly affecting Milan Malpasa, but the decline in traffic represents a more significant drop off than can be attributed to those cuts. So while all this is going on, the value of the company is declining.

Trading in shares is suspended indefinitely. Shares closed at EUR 0.44 which capitalises the company at just over 600 Million Euros. However, trading was suspended before the above passenger figures were published and before it was announced that Alitalia had lost 495 Million Euros in 2007, so it is probably worth more for its assets than as a going concern.

There have been no takers so far, so I wonder if a sale at a token price of say 1 Euro is now in the offing?

Update:
Separately, the European Court of Justice announced it will rule on July 9 on whether financing provided to Alitalia in 2001 constituted illegal state aid.

Alitalia chairman says government loan was in line with EU rules
11 June 2008
Agence France Presse

The Italian government's 300 million euro (465 million dollar) loan to Alitalia is in line with EU law, the chairman of the Italian flag carrier said Wednesday.

"Whether it was by the previous government or the current government, the funds are compatible with EU law," Aristide Police said.

The European Commission launched on Wednesday an illegal state aid probe into the government loan.

The European Union's top competition watchdog warned that "at this stage" it believed that the loan, which Alitalia has the option of converting into equity capital, was "incompatible" with EU state aid rules.

"It's not a coincidence that it was called a bridging loan," Police said. "It is not aid, it's a loan with terms and pretty high interest rates."

The loan was made in the last days of the centre-left government of Romano Prodi shortly after Silvio Berlusconi won mid-April elections.

It is "even less illegitimate aid, but an instrument to help the privatisation succeed, to be within the market and not outside with a state subsidy," Police said.

The commission said that because Alitalia had in the past benefited from state bailouts, Italy could not "in principle" grant it any more aid, despite the cash-strapped company's increasingly perilous situation.

Spokesman Mark English said that the commission had up to a maximum 18 months to carry out its investigation and that in the meantime Alitalia could use the funding.

The commission said its probe into the loan would focus on whether it was made on the same terms as a private investor and would allow all interested parties to voice their opinion.

Rival airlines such as Iberia and British Airways have condemned the loan and Air France-KLM chairman Jean-Cyril Spinetta has said the Italian carrier needed an "exorcist" to save it from bankruptcy.

Alitalia chairman says government loan was in line with EU rules
11 June 2008
Agence France Presse

The Italian government's 300 million euro (465 million dollar) loan to Alitalia is in line with EU law, the chairman of the Italian flag carrier said Wednesday.

"Whether it was by the previous government or the current government, the funds are compatible with EU law," Aristide Police said.

The European Commission launched on Wednesday an illegal state aid probe into the government loan.

The European Union's top competition watchdog warned that "at this stage" it believed that the loan, which Alitalia has the option of converting into equity capital, was "incompatible" with EU state aid rules.

"It's not a coincidence that it was called a bridging loan," Police said. "It is not aid, it's a loan with terms and pretty high interest rates."

The loan was made in the last days of the centre-left government of Romano Prodi shortly after Silvio Berlusconi won mid-April elections.

It is "even less illegitimate aid, but an instrument to help the privatisation succeed, to be within the market and not outside with a state subsidy," Police said.

The commission said that because Alitalia had in the past benefited from state bailouts, Italy could not "in principle" grant it any more aid, despite the cash-strapped company's increasingly perilous situation.

Spokesman Mark English said that the commission had up to a maximum 18 months to carry out its investigation and that in the meantime Alitalia could use the funding.

The commission said its probe into the loan would focus on whether it was made on the same terms as a private investor and would allow all interested parties to voice their opinion.

Rival airlines such as Iberia and British Airways have condemned the loan and Air France-KLM chairman Jean-Cyril Spinetta has said the Italian carrier needed an "exorcist" to save it from bankruptcy.

He would say that would n't he. Fortunately the whole EU Commission has to be satisfied that the terms of the loan are legal.

Alitalia's future is continuing business -chair

ROME, July 11 (Reuters) - A plan for Alitalia's future is not being constructed around a bankruptcy or by putting debts into a separate entity, Chairman Aristide Police said on Friday.

Intesa Sanpaolo is working on a rescue strategy for the ailing airline, which ultimately failed to find a buyer when it was put up for sale by the government 18 months ago.

Newspapers have suggested Intesa Sanpaolo's plan might call for a change to one of Italy's bankruptcy laws or putting Alitalia's debts into a separate "bad company" and bringing investment into the operational activities.

On Thursday, Transport Minister Altero Matteoli said it was too early to talk of changes to financial failure laws in the case of Alitalia, before Intesa Sanpaolo had presented its plan.

"I stand by the statement of the minister who spoke of a solution around continuing the business," Police told journalists on the sidelines of a conference.

Industry Minister Claudio Scajola said on Wednesday the law would be changed to adapt to the situation of "some big companies in crisis," but Matteoli said the government was in agreement to wait until Intesa Sanpaolo had completed its work.

Intesa Sanpaolo is due to complete its plan by early next month for the national airline, which is losing over a million euros a day.

Its shares have been suspended from trading for over a month.

The unions seem to think that Alitalia's main Italian competitor should save themselves and the Company through a merger, while also thinking very little of Berlusconi's promises made during the election campaign:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aqOQC_uC5cAs


Meanwhile there seems to be little support for the Italian Government's attempts to save the airline amongst its own electorate:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ahNJN_9r713g


The European Court ruling on the 9th July regarding a previous loan to Alitalia effectively confirms that the recent 300 Million Euro loan was illegal (the EU's consent to the previous loan included terms barring further loans being made by the Italian Government to Alitalia within the next 10 years). This decision will further deter any potential investors from risking their money in the company:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aRbey8L4h.aA


The Government seems to be preparing for the inevitable bankruptcy:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aFsdTvz47hy4

... but the Chairman of the airline is still in a state of denial, or is it just that he is no longer in the loop?:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=auAKJFU6fZoE


By my reckoning the company's cash funds ran out around the end of June, and so it is probably in effect already bankrupt. I wonder if accounts are still being settled and if the employees are expecting to be paid at the end of the month?

Alitalia faces bankruptcy choice as board meets

ROME, July 25 (Reuters) - Troubled Italian carrier Alitalia will have to decide whether to relaunch via a bankruptcy filing or pursue another option when its board meets Saturday, as its third attempt at finding a buyer sputters to a close.

Alitalia is still flying thanks to an emergency government loan after a planned sale to Air France-KLM fell apart earlier this year, but an oil price surge and a sharp fall in bookings have compounded its long list of troubles.

Prime Minister Silvio Berlusconi said on Friday that news agency reports the government was planning to put the company into extraordinary administration, a way of protecting it from creditors, were "totally groundless."

The airline loses more than 2 million euros a day, and was worth just under $1 billion on the market before its shares were suspended in June after Italy relaunched the sale process.

Latest figures showed the airline's passenger traffic fell 22 percent in May as it cut capacity and travellers fretted about its uncertain future.

Alitalia's board will meet on Saturday, when Chairman Aristide Police will ask its controlling shareholder -- the Italian Treasury -- to declare whether the airline should remain in business, a political source said.

"The chairman will ask the Treasury representative to reconfirm the existence of conditions for continuing business or he'll act accordingly and file for bankruptcy," the source said.

Berlusconi promised earlier on Friday that Italy was close to resolving Alitalia's fate.

"I'm working on it ... For now, we have two things: the necessary capital and the slogan 'I love Italy, I fly Alitalia'," he said.

AVOIDING BANKRUPTCY

The government, which owns a 49.9 percent stake in Alitalia, appears to be in favour of avoiding the bankruptcy option, political and union sources say, despite a widely reported rescue plan by adviser Intesa Sanpaolo that would require it.

Those sources say the government has agreed to give turnaround expert Rocco Sabelli the power to carry out Intesa's plan, but without pursuing bankruptcy, and one union source said the decision could be announced as early as next week.

Under Intesa's plan, a bankruptcy filing would be followed by splitting off the airline's healthy units in which investors could put in as much as 800 million euros, Italian media say.

That plan however, would not be legal unless the government modified Italian bankruptcy law -- a move that development minister Claudia Scajola does not rule out. Intesa and Alitalia would not confirm the plan.

Smaller Italian airline Air One's chief Carlo Toto -- who has long sought to buy Alitalia but was rejected in favour of Air France-KLM, has confirmed his willingness to be part of the investor group, a source familiar with the discussions said.

Italian media have speculated other investors could include wealthy Italian business families like the Benettons and Fossatis and private equity firm Clessidra.

This is the third attempt by the Italian government to sell Alitalia in less than 20 months. An initial auction for the government's stake fell apart last year when all bidders pulled out, while unions scuppered the sale to Air France-KLM.

"... Citigroup downgraded the stock to ``sell/speculative'' from ``sell/high risk,'' citing ``continuing heavy losses'' and the failure to sell the company to Air France. The analysts also trimmed their share-price estimate to 7 euro cents from 45 cents. Alitalia shares closed at 44.5 euro cents on June 3, before being suspended from trading pending a sale. The shares have not resumed trading. ..."

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aqDhLXHNBLB0

With all this bad news for Alitalia, I don't see it going anywhere. The Italian government will keep it alive. With that said I LOVE Alitalia, it's a great airline. :)



I thought I read somewhere that they got rid of their two hub system (Malepensa, Fiumicino) but I think it would really help if they had maglev systems going to the center of the city. It takes a ridiculous amount of time to get to the city center by bus or train for both airports.

With all this bad news for Alitalia, I don't see it going anywhere. The Italian government will keep it alive. With that said I LOVE Alitalia, it's a great airline. :)



I thought I read somewhere that they got rid of their two hub system (Malepensa, Fiumicino) but I think it would really help if they had maglev systems going to the center of the city. It takes a ridiculous amount of time to get to the city center by bus or train for both airports.

I think Alitalia has effectively pulled out of Milan as of Q1 this year - which resulted in a larger than expected drop-off in passengers and load factors.

I think one of the previous posts highlighted that there is little/only minority support for Alitalia amongst the Italian travelling public; many would prefer to see the airline go to the wall rather than have the government waste more money on it. That said, yes there is a matter of national pride involved which still seems to be in denial so the saga probably still has a way to run, though it will start to come to a head this week if the bank finally announces it's rescue proposals (which seem to have been delayed again due to comments from the PM and the Alitalia Board).

Berlusconi may be about to take a lot of flake for the plight of Alitalia. The Board is holding a second (in five days) extraordinary meeting today (Wednesday) with Bank Intesa Sanpaolo reported to be presenting an outline of its proposed rescue plan. It is anticipated that this amounts to bankruptcy and the layoff of 40% of the workforce as the starting point. The airline would then be broken up so that the 'healthy' parts of the business can be sold off, and the rest bined.

http://uk.reuters.com/article/rbssTechMediaTelecomNews/idUKL072831220080730


Air One has been targeted by rumours as a potential buyer of the airline, but, Gilberto Benetton, a key player in any rescue plan has indicated that he believes an international partner is required as part of any realist rescue plan. He has also indicated today (Wednesday) that "no concrete proposal has yet been made", thus throwing into question Berlusconi's recent comments (if there was not already sufficient reason to question all of his comments on the topic).

http://uk.reuters.com/article/rbssTechMediaTelecomNews/idUKL056846320080730


The unions are threatening strike action in response to any lay-offs, but with the Government's preferred solution of pumping in additional funds to postpone the inevitable this time being blocked by the EU Commission, confrontation and grounded aircraft is on the cards. There is however little public support for Alitalia, with Berlusconi's marketing phase for the 'rescued' airline - "I love Italy, I fly Alitalia" - being morphed into "Alitalia flies, Italy pays."

Political impact:
http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKL0104779120080730


So who would buy the 'healthy' bits when most of the potential buyers could now probably divide up the remaining business between themselves by reallocating their existing resources and thus avoid the pains of integrating a worn out business?

Italian PM promises Alitalia 'miracle': report
5 August 2008
Agence France Presse

Italian Prime Minister Silvio Berlusconi has promised a "miracle" to save cash-strapped national airline Alitalia from bankruptcy, according to an interview released on Tuesday.

Berlusconi told the weekly magazine Chi that a rescue plan to save Alitalia would be announced soon.

"We are working. We will perform another miracle and will offer Italy a profitable national company," he said in an extract released by the magazine.

The Italian government said late last month it had pulled together enough funds to rescue the airline, which has been surviving on a loan of 300 million euros (471 million dollars) made in late April from public funds after talks for Air France-KLM takeover collapsed.

The bank Intesa Sanpaolo had been given the task of drafting a rescue plan for the airline by August 1.

Press reports have said the proposals call for dividing the company in two to allow for the creation of a new entity for profitable operations and a second one to deal with debts and less profitable activities.

Such a scheme could lead to the elimination of 4,000 to 10,000 jobs, according to some reports.

State-controlled Alitalia employs 11,100 people in airline transportation while 8,300 work in maintenance for AZ Servizi, controlled by a public holding company.

It recorded pre-tax losses of 215 million euros in the first quarter of this year.

Alitalia passenger traffic falls 21.7 pct in June

ROME, Aug 8 (Reuters) - Passenger traffic at Alitalia slumped by more than a fifth in June from a year earlier, according to the Association of European Airlines (AEA), compounding the problems of the loss-making airline which Italy is trying to sell.

The AEA said Alitalia had 16.4 percent fewer passengers in the first six months of the year than the first half of 2007.

While the AEA said the overall June figures reflected the "depressed situation" of the European market, Alitalia's passenger drop was much sharper than the region-wide fall of 0.1 percent for June.

Air France-KLM, a former suitor for Alitalia, fell only 0.1 percent, British Airways slipped 2.8 percent with Iberia tumbling 14.2 percent.

The data emerged as Prime Minister Silvio Berlusconi tries to talk up the possibility of a rescue bid for Alitalia, whose sale to Air France-KLM failed last year but is now reported to be closer to an alliance with Lufthansa .

"We are in talks with a big foreign company for an alliance on an international level, exactly the opposite of the hypothesis of the fire sale to Air France-KLM, which the previous government wanted, which among other things, included 7,000 job cuts," Berlusconi told local TV late on Thursday.

News agency AGI said Lufthansa could become an investor in a reshaped Alitalia with a 20-25 percent stake. The Italian state put up for sale its 49.9 percent stake in Alitalia in late 2006.

The airline has posted an annual operating loss every year since 1999 and loses around a million euros a day. It is kept in the air by a 300 million euro government loan which the European Commission is probing as possible illegal state aid.

Air France had planned 2,100 jobs cuts at Alitalia and more redundancies at its ground service unit as part of a bid that fell apart over union resistance and criticism from Berlusconi, who was then campaigning for the April election.

Italy has tasked adviser Intesa Sanpaolo with drawing up a new rescue plan, which is expected to suggest putting Alitalia under special administration and then splitting off its healthy parts for new investors and seeking an international alliance.

Italian PM promises Alitalia 'miracle': report
5 August 2008
Agence France Presse

Italian Prime Minister Silvio Berlusconi has promised a "miracle" to save cash-strapped national airline Alitalia from bankruptcy, according to an interview released on Tuesday.

Berlusconi told the weekly magazine Chi that a rescue plan to save Alitalia would be announced soon.

"We are working. We will perform another miracle and will offer Italy a profitable national company," he said in an extract released by the magazine.

The Italian government said late last month it had pulled together enough funds to rescue the airline, which has been surviving on a loan of 300 million euros (471 million dollars) made in late April from public funds after talks for Air France-KLM takeover collapsed.

The bank Intesa Sanpaolo had been given the task of drafting a rescue plan for the airline by August 1.

Press reports have said the proposals call for dividing the company in two to allow for the creation of a new entity for profitable operations and a second one to deal with debts and less profitable activities.

Such a scheme could lead to the elimination of 4,000 to 10,000 jobs, according to some reports.

State-controlled Alitalia employs 11,100 people in airline transportation while 8,300 work in maintenance for AZ Servizi, controlled by a public holding company.

It recorded pre-tax losses of 215 million euros in the first quarter of this year.

More political spin for the Italian consumption - nothing of substance to this.

Alitalia passenger traffic falls 21.7 pct in June

ROME, Aug 8 (Reuters) - Passenger traffic at Alitalia slumped by more than a fifth in June from a year earlier, according to the Association of European Airlines (AEA), compounding the problems of the loss-making airline which Italy is trying to sell.

The AEA said Alitalia had 16.4 percent fewer passengers in the first six months of the year than the first half of 2007.

While the AEA said the overall June figures reflected the "depressed situation" of the European market, Alitalia's passenger drop was much sharper than the region-wide fall of 0.1 percent for June.

Air France-KLM, a former suitor for Alitalia, fell only 0.1 percent, British Airways slipped 2.8 percent with Iberia tumbling 14.2 percent.

The data emerged as Prime Minister Silvio Berlusconi tries to talk up the possibility of a rescue bid for Alitalia, whose sale to Air France-KLM failed last year but is now reported to be closer to an alliance with Lufthansa .

"We are in talks with a big foreign company for an alliance on an international level, exactly the opposite of the hypothesis of the fire sale to Air France-KLM, which the previous government wanted, which among other things, included 7,000 job cuts," Berlusconi told local TV late on Thursday.

News agency AGI said Lufthansa could become an investor in a reshaped Alitalia with a 20-25 percent stake. The Italian state put up for sale its 49.9 percent stake in Alitalia in late 2006.

The airline has posted an annual operating loss every year since 1999 and loses around a million euros a day. It is kept in the air by a 300 million euro government loan which the European Commission is probing as possible illegal state aid.

Air France had planned 2,100 jobs cuts at Alitalia and more redundancies at its ground service unit as part of a bid that fell apart over union resistance and criticism from Berlusconi, who was then campaigning for the April election.

Italy has tasked adviser Intesa Sanpaolo with drawing up a new rescue plan, which is expected to suggest putting Alitalia under special administration and then splitting off its healthy parts for new investors and seeking an international alliance.

Lufthansa was told by its bankers last year that an investment in Alitalia was seen as too risky and would lead to a down-grading of Lufthansa's credit rating. If there is any change in their position, I am sure that it would be towards a stronger warning against any financial involvement. Lufthansa has also indicated that Austrian is high up in its priories while Alitalia is only being monitored for developments. Lufthansa do not need Alitalia anyway; they could probably capture a significant part of the Italian market through their SWISS operation.

Intesa Sanpaolo's rescue proposal is reputed to have suggested a reverse take-over of Air One so as to get hold of the latter's more modern fleet and new aircraft deliveries. The merged airline would jettison some Air One routes and probably a large proportion of the latter's staff and would end up with over 60% of the Italian domestic market.

There are a whole load of questions and issues that arise with this proposal which is probably why the details have not been published. There is also a divide between factions of the Government and at the top of Alitalia over this proposal even before the EU Commission raises any competition and regulation concerns.

Still no solid plan announced.

Meanwhile an Italian Consumer group reports that Alitalia has cost the Italian public 5.2 billion Euros over the last 10 years:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a0WOxiFFvLLs

INTERVIEW-Small Alitalia investors demand compensation

ROME, Aug 21 (Reuters) - Minority shareholders in Alitalia may take legal action unless a rescue plan for the troubled airline compensates them through warrants or other measures, the head of a group organising the investors said.

Shares of Alitalia have been suspended since June after the Italian government, which owns the controlling 49.9 percent stake, began a third attempt to sell the near-bankrupt carrier.

A long-awaited rescue plan by adviser Intesa Sanpaolo that could be unveiled next week is expected to propose a bankruptcy filing and splitting off the airline's healthy parts for new investors while leaving everything else in a so-called "bad company".

Alitalia's minority shareholders and bondholders fear they will end up with nothing and want either warrants allowing them to buy shares in a restructured Alitalia at a preset price or have part of the capital hike reserved for them, said Domenico Bacci of the Siti non-profit group.

"Our main concern is that one cannot have a rescue plan without safeguarding the Italians that continued to believe in the future of the airline through all these months," said Bacci, whose group defends investors in cases of financial collapse or fraud, such as Parmalat and Cirio.

"The minority shareholders have as much right to participate in the new company as anyone else; the form that takes can be discussed -- either through the issue of warrants or having part of the capital increase reserved for them."

Bacci said it was difficult to quantify the number of investors who have came forward under his group's initiative, since the effort to gather investors together was launched in July, just before the August holiday period.

According to the latest Reuters data, Air France-KLM -- whose deal to buy Alitalia collapsed over union opposition -- is the second-largest investor in Alitalia with a 2 percent stake, followed by 31 institutional holders who each hold a stake of less than 0.01 percent. The airline was worth just under $1 billion when its shares were suspended.

"We reserve the right to begin legal action if we are not guaranteed any compensation," said Bacci. "For now, we're waiting to see the rescue plan, and if the proposals we want don't materialise, we will move on that front."

The group has not yet decided whether to sue the government or Alitalia or the architects of its rescue plan, Bacci said.

But he said small investors were not to blame for failing to get out when the airline's fortunes began sinking, adding the government had reassured investors by stepping in earlier this year with a 300 million euro loan to keep the airline afloat.

"For small investors, the moment to get out is never clear," he said. "When a small investor sees that the Italian government is intervening to finance the company, he continues to hope that the plan to salvage the airline is being completed."

Crucial week for Italy's near-bankrupt flag carrier
25 August 2008
Agence France Presse

Italy's near-bankrupt flag carrier Alitalia may know its fate this week as the company reveals its first-half results, expected to be disastrous, and a possible rescue plan takes shape.

Potential bidders in a consortium to rescue the airline were on Monday set to declare their interest in the project, according to a source close to the dossier.

The company, in which the state has a 49.9 percent stake, has been surviving on a loan of 300 million euros (471 million dollars) made in late April from public funds after the collapse of takeover talks with Air France-KLM.

Investors and business leaders met on Monday with Intesa Sanpaolo, the Italian banking giant tasked with advising the government on the operation, and were expected to outline "their availability to invest in the project to relaunch Alitalia," the source close to the dossier said.

Possible bidders include the Benetton clothing group, insurance magnate Salvatore Ligresti, the transport group Aponte and the Equinox investment fund.

Alitalia announced pre-tax losses of 215 million euros in the first quarter of this year.

The airline is some 400 million euros in the red, according to an estimate by the Bruno Leoni research institute.

Bidders must make a formal commitment on Monday so that a definitive offer for the airline can be presented to its board of directors on Friday, when the company is to announce its first-half results.

Intesa Sanpaolo has developed a plan that would hive off the unprofitable parts of the company into an entity that could declare bankruptcy, while relaunching the money-making parts.

The new Alitalia would join forces with its domestic rival Air One to create what is being billed as a "national champion."

Together, the two airlines would have nearly 65 percent of the market and Alitalia would be able to retire part of its fleet, considered the oldest in Europe.

In a later phase, the new Alitalia is expected to go into an alliance with a foreign company.

The daily La Stampa reported that Germany's Lufthansa has asked for a 20 to 25 percent stake in Alitalia in exchange for support for the Italian airline's relaunch.

However, uncertainty over the project is deep, beginning with the question of job cuts.

Some 7,000 of the company's 20,000-strong work force will have to be laid off, according to press leaks in recent weeks.

"We are anxious to know exactly how many layoffs are planned for Alitalia," said Raffaele Bonanni, secretary of CISL, a leading Italian trades union, on Monday.

Alitalia's debts are another big issue -- business leaders who have come forward to take over the company have made clear that they do not want to take them on board.

The rescue plan would leave the debts and unprofitable units in state hands -- a legally unviable prospect. However, the government could move quickly to introduce new bankruptcy legislation to make it possible as soon as Thursday.

Italian Prime Minister Silvio Berlusconi early this month promised a "miracle" to save the national flag carrier.

The billionaire Berlusconi is blamed for the failure of Air France-KLM's takeover bid by making it an election issue ahead of the polls he won in mid-April when he made repeated assurances that an all-Italian consortium would carry the day.

Italian group offers to buy Alitalia stake
Published: 2008/09/04

ROME: An Italian investor group leading a government-sponsored rescue of Alitalia has submitted a preliminary offer to buy a large chunk of the bankrupt airline, the carrier said in a statement.

No details about the offer were disclosed, but Alitalia said the bid by Compagnia Aerea Italiana (CAI) appeared to meet requirements under a newly modified bankruptcy law, according to the commissioner overseeing its bankruptcy.

Sources close to the matter had earlier said CAI, a group of 16 top Italian business figures led by Piaggio chief executive officer Roberto Colaninno, submitted the bid on Monday.

The offer is part of the government's latest attempt to settle the fate of the carrier, which filed for bankruptcy last week after 20 months on the block.

Under the plan, the investors will buy Alitalia's best parts and relaunch it as a smaller airline focusing on short and medium haul routes, before hunting for a foreign alliance.

Italy's government, which owns 49.9 per cent of the carrier, changed bankruptcy law and suspended antitrust rules last week to faciliate the rescue. - Reuters

Alitalia to be new company on Nov 1
Published: 2008/09/08

ALITALIA SpA, Italy’s insolvent state-controlled airline, will become a new company on November 1 after a government-backed reorganisation, Industry Minister Claudio Scajola said.

“I think the situation is such that this deadline will be respected,” Scajola said at a conference yesterday in Cernobbio, Italy. “We need an airline which can be competitive as soon as possible.”

A government rescue plan aims for Rome-based Alitalia to boost revenue and break even in two years, while adding new planes after a group of investors buys its best assets and unprofitable ones are sold. - Bloomberg

EU scrutiny of Alitalia rescue will be thorough
6 September 2008

CERNOBBIO, Italy (AP) - The European Union is studying an Italian measure passed to save struggling national carrier Alitalia to ensure that EU rules are respected, the EU transport chief said Saturday.

Transport Commissioner Antonio Tajani said in an interview with The Associated Press that assessment would take weeks, and that Italian government officials may be called upon for talks if any clarification is needed.

The Italian government passed the measure, a decree, late last month to revise the bankruptcy-protection legislation.

The move raised concerns that the custom-tailored law could qualify as state aid, which Alitalia cannot receive under EU rules. The EU already is investigating whether those rules were broken by a government loan given to Alitalia in April to keep the cash-strapped carrier flying.

"We will assess the text word by word," Tajani said. "We will also assess its implementation."

"My attitude will neither be persecutory nor indulgent," he said on the sidelines of a conference of global business and political leaders in this northern Italian resort on Lake Como. "We will neither attack nor defend. We will only work to ascertain that Italy has acted in the respect of EU norms."

The government's decree was presented to the EU before its adoption at a Cabinet meeting Aug. 28, Tajani said.

The decree paved the way for Alitalia to declare insolvency and seek bankruptcy protection the following day.

The move was crucial in Premier Silvio Berlusconi's government's plan to reshape Alitalia, a company that had been losing euro2 million (US$3 million) a day amid labor unrest, competition from budget airlines and, recently, high fuel prices. Its shares have been suspended from trading since June.

Under the plan, Alitalia's profitable assets are to be taken over by a group of Italian investors ready to inject euro1 billion (US$1.5 billion). The other assets are expected to be liquidated.

Tajani said the EU is also assessing the industrial plan presented by the investors. The plan was presented to EU transports authorities in a meeting Wednesday, which Tajani described as "fruitful." He said he has repeatedly stressed the need for respecting EU norms in "formal and informal" talks with members of Italian bank Intesa Sanpaolo, which is acting as the government's adviser for Alitalia.

He said it was premature to give further comment.

The investors who will take over the new, slimmer Alitalia are headed by Roberto Colaninno, the chairman of motorcycle maker Piaggio.

Alitalia is also looking for a foreign partner. Possible candidates mentioned have included Air France-KLM, which earlier this year walked out of talks to take over the airline, and Germany's Lufthansa. The plan will also be presented to British Airways, Intesa Sanpaolo executive Gaetano Micciche was quoted Saturday as saying by financial daily Il Sole 24 Ore.

However, no decision has been made, and no foreign investor would have a majority stake, Intesa Sanpaolo CEO Corrado Passera said Saturday.

"We can rule out any possible international partner having a majority stake, either absolute or relative, now and in the future," Passera told reporters on the sidelines of the gathering in Cernobbio.

Berlusconi has said he wants Alitalia to remain in Italian hands, on grounds that its being under foreign ownership would hurt the country's tourism industry and damage Italy's overall prestige. He was opposed to the Air France-KLM takeover plan and made rescuing the company a chief promise of his electoral campaign before April elections.

Alitalia unions warned of dismissals in absence of agreement
10 September 2008
Agence France Presse

The special administrator for foundering Italian carrier Alitalia warned unions Wednesday he would begin to dismiss workers if a deal on a new labour contract was not reached on Thursday.

Augusto Fantozzi, appointed late last month after Alitalia asked to be declared bankrupt, said that unless agreement was reached by a Thursday deadline, the company would proceed to "cancel (labour) contracts" and would begin procedures leading to dismissals.

He has warned repeatedly that in the absence of a deal with Alitalia unions, the airline -- which by the end of September will have only 30 to 50 million euros (42-70 million dollars) at its disposal -- will fail.

Fantozzi told unions that negotiations with an alliance of Italian investors prepared to take over -- and re-launch -- Alitalia would resume Thursday at the labour ministry.

Talks were suspended late Monday. Union negotiators rejected investor proposals for a single labour contract and for reductions in salaries and vacation time.

"The alternative is failure and that should induce everyone to adopt reasonable behaviour," said Labour Minister Maurizio Sacconi.

Talks between the Franco-Dutch carrier Air France-KLM and Alitalia on a full takeover and rescue collapsed in April when the airline's future became an issue in elections won by Silvio Berlusconi, who promised voters an "Italian solution" to its problems.

Alitalia, burdened with a debt of 1.7 billion euros at the end of July, employs 11,100 people in its air transport operations and a further 8,300 in maintenance and services.

The company, in which the Italian state has a 49.9 percent stake, has been surviving on a loan of 300 million euros made in late April from public funds after the collapse of the takeover talks with Air France-KLM.

Alitalia unions, investors in talks on airline's future
11 September 2008
Agence France Presse

Unions at Alitalia and investors who want to reorganise the ailing Italian carrier were locked in talks Thursday on a plan seen as a last-ditch bid to save the company from bankruptcy.

The negotiations, which began a week ago but were suspended on Monday, are deadlocked, with unions rejecting an investor proposal for a single labour contract and cuts in salaries and vacation days.

Job cuts at a revived Alitalia, which could number between 3,250 and 4,000, have yet to be discussed.

Alitalia's special administrator, appointed late last month when the airline asked to be declared insolvent, warned unions Wednesday he would begin to dismiss workers if a deal on a new labour contract were not reached on Thursday.

Augusto Fantozzi has also warned that in the absence of a deal with Alitalia unions, the company -- which by the end of September will have only 30 to 50 million euros (42-70 million dollars) at its disposal -- will fail.

Talks between the Franco-Dutch carrier Air France-KLM and Alitalia on a full takeover and rescue collapsed in April when the airline's future became an issue in elections won by Silvio Berlusconi, who promised voters an "Italian solution" to its problems.

Alitalia, burdened with debt, employs 11,100 people in its air transport operations and a further 8,300 in maintenance and services.

The company, in which the Italian state has a 49.9 percent stake, has been surviving on a loan of 300 million euros made in late April from public funds after the collapse of the takeover talks with Air France-KLM.

FACTBOX-Italy foots bill for Alitalia rescue

Sept 12 (Reuters) - Italy's rescue of Alitalia followed a familiar "Italian solution" script favoured by governments in the country, where domestic investors step in to bail out a company considered strategic to thwart foreign control.

But critics and the opposition say the patriotic rescue called for by Prime Minister Silvio Berlusconi ultimately will be financed by Italians, whose taxpayer funds were also used to lend 300 million euros to the cash-strapped airline in April.

The Economist magazine estimated that at the end of the rescue, about 5 billion euros of public money will have been pumped into saving Alitalia over the years, or about 125 euros by each Italian taxpayer.

Here's how the Italian solution could end up costing the state and taxpayers:

HIGHER AIRFARES

Consumer groups and competitors complain that the government's suspension of antitrust laws to permit Alitalia to merge with domestic rival Air One will give it monopoly control over the lucrative Milan-Rome route and hike fares.

Noting that Alitalia and Air One together control 67 percent of traffic at Milan's Linate airport and 58 percent at Rome's Fiumicino airport, low-cost rival carrier Easyjet was one of several critics to warn that this could restrict choice and lead to "extremely high" fares.

GOLDEN PARACHUTES FOR BAGGAGE HANDLERS?

Alitalia's employees have long enjoyed generous benefits and pay and fended off successive restructuring efforts thanks to the political muscle of their unions, who felled a sale of the airline to Air France-KLM this year. Eager to avoid a fresh union backlash, the government has promised welfare benefits for seven years and the option of jobs at other public or private firms for the more than 3,000 employees who will be laid off.

One newspaper estimated the welfare benefits alone for fired employees will cost the state 1 billion euros.

BAILING OUT SMALL INVESTORS

The government also plans to refund small savers who had invested in Alitalia by turning to dormant public funds available to it, a move expected to cost 200-300 million euros according to La Repubblica newspaper. A group representing investors had threatened lawsuits if they were not compensated.

ALITALIA'S "BAD COMPANY"

Under the "Phoenix" plan, Alitalia's profitable parts will be sold off to Italian investors while its troubled parts and debt of more than 1 billion euros will likely be liquidated, with the state likely to absorb the losses.

CHRONOLOGY-Alitalia's troubled sale process

Sept 12 (Reuters) - Italian investors trying to help save Alitalia SpA from collapse have broken off talks with the airline's unions, saying they see no way to break an impasse. [ID:nLC510628]

Below is a timeline of Alitalia's troubled sale process:

DECEMBER 2006 -- INITIAL AUCTION

The previous centre-left government announces it is putting its Alitalia stake up for sale. The state owns 49.9 percent and sought bids for at least 39.9 percent of the carrier, which would automatically trigger a full bid under Italian takeover law.

There were 11 bidders initially but the auction collapsed in July 2007 as the number shrank gradually, until the only remaining bidder -- smaller rival Air One -- also pulled out.

DECEMBER 2007 -- SECOND TRY

Alitalia then draws up its own list of six potential partners and French-Dutch carrier Air France-KLM and Air One put in non-binding bids.

The centre-left government overlooked lobbying by unions and regional politicians to pick Air France-KLM for exclusive talks.

The two airlines agreed on a takeover that valued Alitalia shares at 10 euro cents, or $184 million, an 81 percent discount to the price they were trading at the time.

Criticism from the then leader of the opposition Silvio Berlusconi during the election campaign, plus a lawsuit by Milan's airport operator, put the deal at risk and it ultimately fell apart over union opposition.

APRIL 2008 - THIRD TIME NOT SO LUCKY

After returning to office as prime minister for a third spell in April, Berlusconi launches third attempt to secure Alitalia's future, promising a group of Italian investors would buy it. Normal disclosure requirements on the sale progress were waived and Alitalia shares were suspended indefinitely in June.

The new centre-right government asked bank Intesa Sanpaolo to draw up a plan, which eventually had Alitalia seek bankruptcy protection under a new process for "public service" companies on Aug. 29.

Berlusconi's cabinet suspended antitrust laws and overhauled bankruptcy law to accommodate the rescue. It hired a special administrator to sell assets to a single buyer of his choice rather than the highest bigger.

A group of investors led by Roberto Colaninno called Compagnia Aerea Italiana (CAI) on Sept. 3 submitted an offer for parts of Alitalia to create a smaller airline with the help of Air One, a domestic rival.

The plan's success was dependent on union approval and a partnership with a foreign airline and the administrator gave unions until Sept. 11 to accept the plan, warning he would liquidate the airline if they refused.

Despite the reluctant support of one union, the others rejected the plan.

CHRONOLOGY-Alitalia's troubled sale process

Sept 12 (Reuters) - Italian investors trying to help save Alitalia SpA from collapse have broken off talks with the airline's unions, saying they see no way to break an impasse. [ID:nLC510628]

Below is a timeline of Alitalia's troubled sale process:

DECEMBER 2006 -- INITIAL AUCTION

The previous centre-left government announces it is putting its Alitalia stake up for sale. The state owns 49.9 percent and sought bids for at least 39.9 percent of the carrier, which would automatically trigger a full bid under Italian takeover law.

There were 11 bidders initially but the auction collapsed in July 2007 as the number shrank gradually, until the only remaining bidder -- smaller rival Air One -- also pulled out.

DECEMBER 2007 -- SECOND TRY

Alitalia then draws up its own list of six potential partners and French-Dutch carrier Air France-KLM and Air One put in non-binding bids.

The centre-left government overlooked lobbying by unions and regional politicians to pick Air France-KLM for exclusive talks.

The two airlines agreed on a takeover that valued Alitalia shares at 10 euro cents, or $184 million, an 81 percent discount to the price they were trading at the time.

Criticism from the then leader of the opposition Silvio Berlusconi during the election campaign, plus a lawsuit by Milan's airport operator, put the deal at risk and it ultimately fell apart over union opposition.

APRIL 2008 - THIRD TIME NOT SO LUCKY

After returning to office as prime minister for a third spell in April, Berlusconi launches third attempt to secure Alitalia's future, promising a group of Italian investors would buy it. Normal disclosure requirements on the sale progress were waived and Alitalia shares were suspended indefinitely in June.

The new centre-right government asked bank Intesa Sanpaolo to draw up a plan, which eventually had Alitalia seek bankruptcy protection under a new process for "public service" companies on Aug. 29.

Berlusconi's cabinet suspended antitrust laws and overhauled bankruptcy law to accommodate the rescue. It hired a special administrator to sell assets to a single buyer of his choice rather than the highest bigger.

A group of investors led by Roberto Colaninno called Compagnia Aerea Italiana (CAI) on Sept. 3 submitted an offer for parts of Alitalia to create a smaller airline with the help of Air One, a domestic rival.

The plan's success was dependent on union approval and a partnership with a foreign airline and the administrator gave unions until Sept. 11 to accept the plan, warning he would liquidate the airline if they refused.

Despite the reluctant support of one union, the others rejected the plan.

What a shame!

I've just read that starting from Monday a large number of Alitalia planes will stay on the ground, because they have no money to purchase fuel anymore!

Italy PM says will do all he can to save Alitalia

ROME, Sept 13 (Reuters) - Italy's Prime Minister Silvio Berlusconi said on Saturday he would do all he could to save Alitalia from collapse, as the airline's bankruptcy commissioner said the carrier's situation was "plummeting".

A day after a deadline passed for unions to agree a rescue plan, Berlusconi rushed back to Rome from the southern city of Bari to consult key ministers on Alitalia, the loss-making flag carrier which he has said must remain in Italian hands.

"The executive is always ready with its ministers, and today even with the prime minister, to give all the possible support to get to the only solution possible to avoid the airline going bust," Berlusconi told ANSA news agency.

The airline's bankruptcy commissioner had set early Friday as a deadline for a deal between unions and the Italian investors that have agreed in principle to buy the profitable parts of the heavily loss-making airline.

Augusto Fantozzi had said he would start liquidating the company and laying off its staff but on Saturday he convened unions to a meeting that they had requested at 2 p.m. (1200 GMT).

"I'm not declaring insolvency this evening but the situation is plummeting," Fantozzi told reporters.

Italy's Labour Minister Maurizio Sacconi gave Alitalia a 50-50 percent chance of survival.

"We are in the final phase of the long and tortuous Alitalia saga and both outcomes are still possible in equal measure," he said.

In April, Alitalia's unions sank a deal agreed under the previous, centre-left government to sell the airline to Air France-KLM and are now under intense pressure to accept the job losses and reduced conditions that the latest rescue plan would impose.

"What's certain is that this is a failed company and therefore there isn't any alternative," Industry Minister Claudio Scajola said on Friday. "Either a deal is reached or all of the workers are laid off."

The fate of Alitalia has huge political significance for Berlusconi, who swept back into power at an April election after almost two years in opposition, promising to use his business connections to keep the flag carrier Italian.

CAI, the consortium of Italian businesses he persuaded to make an offer for Alitalia said on Saturday it was not prepared to make additional concessions to employees.

"We repeated to (Berlusconi aide Gianni) Letta our position: ready to talk but steadfast on the contents (of a deal)," CAI Chief Executive Rocco Sabelli told reporters as he left a meeting with government representatives.

Alitalia, a symbol of Italy's post-war economic boom has been constantly dogged by labour disputes and financial woes and has not posted a profit since 1999 and had nearly 1.2 billion euros ($1.68 billion) in debt as of July.

Unions held out for government intervention. "At the point we are at now it is up to the government to come up with an initiative with the consortium," Guglielmo Epifani, head of Italy's biggest union confederation CGIL, told Corriere della Sera daily.

Pope Benedict, who travelled to France on a chartered Alitalia flight on Friday, said he was praying for the airline.

I've just read that starting from Monday a large number of Alitalia planes will stay on the ground, because they have no money to purchase fuel anymore!

Alitalia official says some flights might be at risk due to fuel supply problems
13 September 2008

ROME (AP) - Alitalia's bankruptcy administrator on Saturday warned unions opposed to a rescue plan that time was running out for saving the Italian carrier, as flights were at risk of cancellation for lack of fuel and some workers would be laid off soon.

Meanwhile, Premier Silvio Berlusconi rushed back to Rome from a southern Italian city to offer his help in breaking the deadlock between a group of investors tapped to take over the company and unions opposed to the plan. He summoned unions to a meeting later Saturday.

Talks between the unions and the investors were suspended Friday when the investors walked away, having failed to obtain the crucial support of Alitalia's nine unions. Each side accused the other of being intransigent.

But the investors' offer remains on the table, leaving the government and the administrator, Augusto Fantozzi, scrambling for a solution as Alitalia edges toward collapse.

"There are difficulties concerning fuel supply, which could endanger some flights," Fantozzi told the unions during their meeting in Rome, according to an Alitalia statement.

Alitalia denied news reports quoting Fantozzi as telling the unions that the company could guarantee flights only until Sunday. But it did say it was becoming more difficult to "ensure ordinary services necessary for flying activities."

"So far we have tried, amid a thousand difficulties, to guarantee regular service," it said.

The ENAC civil aviation agency said in a statement that Alitalia's license to operate was also at risk "if a solution is not found soon that guarantees the continuing of the carrier's operations."

According to Alitalia and union leaders, Fantozzi informed unions that he would start laying off some Alitalia workers -- the crews of 34 aircraft that are not currently being used -- and enroll them in welfare programs. He said he would take all further measures necessary in the face of "the very grave crisis."

"He has explained that we are at a very critical situation," said union representative Roberto Panella. Panella also quoted Fantozzi as saying he would have to begin procedures to terminate employment contracts on Monday.

"We are aware of this urgency," Panella said, calling on the investors to abandon what he said was the rigidity of their position and on the government to intervene.

But the investors insisted they would not make concessions, according to the ANSA news agency. Rocco Sabelli, the man who had been designated to be the chief executive of the new Alitalia, said the group was willing to talk, but added that "on the contracts and on the plan, our position is firm," ANSA said.

Alitalia, which had been losing some €2 million (US$3 million) a day, was declared bankrupt on Aug. 29. The move paved the way for the investors to negotiate their plan to buy Alitalia's profitable assets.

The rescue plan reportedly envisages a €1 billion (US$1.4 billion) investment, the merger with Italy's No. 2 airline, Air One, and a partnership with a foreign carrier.

Among the sticking points in the talks are new contracts, salary cuts and layoffs that might run to 5,000 of the airline's 20,000-strong work force.

Berlusconi, who traveled from Bari to follow the crisis, said he was "very worried" about the situation, and that he could not understand "this suicidal behavior," ANSA reported.

The premier, who has made solving Alitalia a priority of his government, said he was ready to intervene to help break the deadlock.

"The government is always ready with its ministers, and today even with the prime minister, to give all support possible to get to the only solution possible to avert the collapse of the company," Berlusconi was quoted as saying.

On Friday, a few hundred Alitalia workers staged a protest at Rome's Leonardo da Vinci airport, while others gathered outside the company headquarters where Fantozzi was meeting with unions.

Italian government meets unions, investors in last-ditch effort to save bankrupt Alitalia
14 September 2008

ROME (AP) - The Italian government held emergency talks with unions and investors Sunday over a plan to save Alitalia, as the bankrupt airline risks having to ground flights for lack of fuel.

The rescue plan would have investors buying profitable assets and investing $1.4 billion. But the plan also envisages wage cuts and layoffs opposed by the unions.

The government began mediating when direct talks broke down Friday, after the investors failed to win the unions' crucial support. But the investors said their offer remained on the table.

The labor and transport ministers met Sunday with representatives of flight attendants and pilots, who have been the most critical of the rescue plan. The talks had started on Saturday but ended late at night with no resolution.

Among the sticking points in the talks are new contracts, salary cuts and layoffs that might run to 5,000 of the airline's 20,000-strong work force.

Reaching an agreement "depends a lot on what we'll be able to do today, and on the realism and flexibility that everyone will have: the government, the company and the unions," said Raffaele Bonanni of the CISL national labor confederation.

Alitalia's bankruptcy administrator warned Saturday that time was running out for saving the airline, saying lack of fuel supply and other problems might force the airline to ground some flights.

Administrator Augusto Fantozzi also said he would start procedure to lay off a number of Alitalia workers and enroll them in welfare programs.

Alitalia also risks losing its license to operate "if a solution is not found soon that guarantees the continuing of the carrier's operations," said the civil aviation agency, ENAC.

The Italian newspaper Corriere della Sera said Sunday that the investors might offer an additional $140 million in order to minimize the wage cuts and overcome the unions' opposition.

Alitalia, which had been losing some $3 million a day, was declared bankrupt on Aug. 29. The move paved the way for the investors to negotiate their plan to buy Alitalia's profitable assets.

The rescue plan also reportedly calls for the merger with Italy's No. 2 airline, Air One, and a partnership with a foreign carrier.

Italy scrambles to save Alitalia
Published: 2008/09/15

ROME: The Italian government held emergency talks with unions and investors yesterday over a plan to save Alitalia, as the bankrupt airline risks having to ground flights for lack of fuel.

The rescue plan would have investors buying profitable assets and investing US$1.4 billion (US$1 = RM3.46). But the plan also envisages wage cuts and layoffs opposed by the unions.

The government began mediating when direct talks broke down Friday, after the investors failed to win the unions' crucial support.

The labour and transport ministers met yesterday with representatives of flight attendants and pilots, who have been the most critical of the rescue plan. The talks had started on Saturday but ended with no resolution. - AP

The same issues remain from the beginning of this process to now - there is a lot of political unwillingness to let big job cuts go through, and unless they can accept that, there is little hope to turn the airline around.

FEATURE-Planning a bailout? Italy shows the way

MILAN, Sept 12 (Reuters) - Italy may have earned a bad name for changing the rules to rescue its corporations, but in these straitened times Prime Minister Silvio Berlusconi's bespoke bailout of airline Alitalia puts him in illustrious company.

Manoeuvres like last month's change to Italian bankruptcy law for companies providing a public service, and suspension of antitrust rules, have typically won scant approval from the international investing community.

Italian government bonds yield about 70 basis points more than German paper, one of the highest risk premiums in the euro-zone. According to the IMF, Italy attracted about $40 billion in new foreign direct investment in 2007, equivalent to 1.9 percent of GDP. That compares with about 5.8 percent of GDP for France and 4.2 percent of GDP for Spain.

But where before the credit crunch, the rallying cry championed by financial powers led by the United States was a market-led government-light pursuit of profit, now in other economies struggling with the disconnection in credit markets, pressure is mounting on governments to intervene.

"What has been done for bailing out Alitalia is a slap in the face of all free-market, rule-of-law, separation-of-powers norms and practices," said Carlo Alberto Carnevale-Maffe, a professor at Bocconi University's business school.

"But it is widely popular. In bad times of uncertainty, nation-states provide quick and cheap (so to say) reassurance to the disoriented many."

The risk for Italy was not systemic -- like that faced by the U.S. government in seizing control of mortgage finance companies Fannie Mae and Freddie Mac in what could be its biggest ever bailout.

And Italy is not alone in acting unilaterally to preserve perceived strategic interests. France stepped in to help once-struggling engineering firm Alstom, Britain rescued building society Northern Rock and even the United States was accused of protectionism for warding off Dubai's DP World from its port terminals.

But Italy's government, which owns 49.9 percent of the floundering carrier, did act radically: it changed the laws to set up the rescue by a group of Italian investors, after a sale to Air France-KLM failed.

BUSINESS-FRIENDLY

The deal is one of a line of corporate rescues pulled together with clever rule changes by Italy's political and financial elite, fulfilling an election pledge from Berlusconi to find Italian buyers for a carrier no-one seemed to want.

The country's previous major rescue came at the end of 2003 when food group Parmalat -- a household name for its long-life milk -- collapsed under the weight of 14 billion euros in debt.

It was another Berlusconi administration that changed the laws then, speeding up the insolvency process and giving administrator Enrico Bondi nine months to put a new strategy together instead of the previous 60-day deadline.

This time around, a group of executives led by Roberto Colaninno, who in 1999 championed Olivetti's leveraged buyout of Telecom Italia and later brought Vespa scooters back into the black, submitted an offer after the rules were changed for just the best bits of Alitalia -- likely to include slots, planes and partnerships.

News media may smart on the taxpayers' behalf -- commentator Eugenio Scalfari in an editorial for La Repubblica called the Alitalia deal a "typical case of nationalising the debt and privatising the profit".

The carrier had already had a 300 million euro cash injection from the government, which the European Commission could end up considering illegal state aid.

But the EU's transport commissioner Antonio Tajani -- a former spokesman for Berlusconi -- has already said Brussels has no option but to view the rescue positively.

International bankers are not complaining.

"Italy is and remains a country open to investment," said Sergio Ascolani, head of banking for Citigroup in Italy, in the wake of the Alitalia rescue. Citigroup was adviser to Alitalia while it was discussing the Air France deal.

"The changes to the previous law were needed and they made it more flexible," said Ascolani. "Of course, legislative uncertainty never helps. But the actual situation is alright even if there's room for improvement."

Italy's global ranking in a World Bank report this week on the ease of doing business slipped to 65th from 59th -- well behind the United States and Britain. But it was praised for expanding creditors' rights to let distressed companies seek a deal without declaring bankruptcy.

"The solution from the point of view of ... decree laws, talks, antitrust, protection of shareholders and so on, seems to me excellent," said Oliviero Baccelli, professor at Milan's Bocconi University and vice-director at transport research centre CERTeT.

"Now we need clarity on the industrial plan," he added.

PRIVATE PROFIT, PUBLIC PAIN

Many of the investors lined up for Alitalia have businesses working with the government, which has led to speculation they could gain political benefits for helping out.

Looking at the list of businessmen, "you won't find a single one that isn't waiting for pretty lucrative government favours," wrote Alberto Statera in newspaper La Repubblica.

Consumer groups and competitors complain that Alitalia's dominant position after the rescue deal could restrict choice and lead to "extremely high" fares.

The government crimped antitrust powers so the carrier's future dominance of the lucrative route from the financial capital Milan to Rome would not be a problem.

"It's right to wonder how on earth there can be any important national economic interest in allowing the new Alitalia to retake a dominant position on national routes," said economists on the respected lavoce.info Web site.

More pain for the public could come if the government has to cope with layoffs for around 3,000 airline employees or doles out compensation to them, as well as assuaging small shareholders and Alitalia's creditors.

"I don't think Alitalia changes the relationship of Italy to the rest of Europe for investment," said Simon Goodfellow, strategist at ING in London, noting that management of European airlines has long reflected political concerns.

"All governments treat airlines as a special case." (Additional reporting by Jamie McGeever; Editing by Catherine Evans and Sara Ledwith)

Pilots' union reject Alitalia rescue plan

ROME, Sept 17 (Reuters) - One of the unions representing Alitalia's pilots said on Wednesday it still rejected a rescue plan by a group of investors after the group said it would withdraw the offer without union approval, a union source said.

The Pilots Union, the second biggest labour group representing the airline's pilots, said that if no changes were made its assessment of the plan remained negative, the source said.

The head of the investors' group earlier said he could not make further concessions and that he would propose to withdraw the offer at a shareholder meeting on Thursday unless unions come on board by then.

AFP, September 18, 2008;
Alitalia rescue consortium withdraws: report

ROME (AFP) — An Italian consortium that proposed to take over Alitalia withdrew its offer Thursday for the stricken Italian flag carrier, dooming it to bankruptcy, a news agency reported.

The Radiocor agency said the Italian Air Company (CAI) consortium pulled out after labour unions failed to accept the takeover plan which would have meant the loss of 3,250 jobs.

The Sky TG 24 news channel also reported that CAI would drop its offer, while the ANSA agency said it was likely, quoting union officials as saying they had been told so unofficially from four sources.

A CAI spokesman refused to either confirm or deny the reports.

Both the consortium and the government had said there could be no more negotiations, and CAI chief Roberto Colaninno said Wednesday that without a union consensus the offer would be withdrawn.

The nine unions were given a deadline of 4 pm (1600 GMT), when the CAI was to meet, to give their response, but only three had accepted in last-ditch talks on Tuesday.

The other six, including the pilots' union and Italy's largest employees' organisation, the CGIL, demanded further talks.

Transport Minister Altero Matteoli warned earlier Thursday, "There is no alternative -- if we don't sign today, we are facing bankruptcy."
Link (http://afp.google.com/article/ALeqM5jftn6JHoHIE8C8Z5g_3ayxtiLEWA)

Times Online, September 18, 2008:
Italian national airline Alitalia 'collapses'
Richard Owen in Rome

The bankrupt Italian airline, Alitalia, faces imminent collapse after a consortium of Italian industrialists this afternoon withdrew its offer to buy the carrier.

The takeover consortium, the CAI, had laid down a deadline of 3.50pm local time for the airline's nine unions to back it. As the deadline neared, Maurizio Sacconi, Italy's Labour Minister, admited that Alitalia's future was "hanging by a thread".

After the deadline passed, Italian media, quoting CAI sources, said the group of investors, led by Roberto Colaninno, chairman of the scooter manufacturer Piaggio, was withdrawing its bid. With no other offers on the table, Alitalia's administrator, Augusto Fantozzi, said this would mean the airline now faced liquidation proceedings.

Silvio Berlusconi, the Italian Prime Minister, has said the airline's 20,000 workers cannot expect generous redundancy packages in the case of liquidation. Mr Fantozzi said although previous deadlines had come and gone, this time Alitalia has no cash left to continue.

Alitalia needs 1.4 million Euros a day for fuel and loses a further two million Euros a day, adding to debts of 1.17 million Euros. The CAI consortium had offered to inject 1.5 billion Euros into Alitalia and merge it with Air One, Italy's second largest carrier..

Three of the four larger unions said they could accept the deal, but smaller ones, including those representing pilots and flight attendants, objected to the proposed loss of over 3,000 jobs and new contracts laying down longer hours for the same pay

However Fabio Berti, leader of ANPAC, the pilots' union, said his members were prepared to make "extraordinary sacrifices" to persuade CAI to change its mind and return to negotiations.

Despite the crisis, Alitalia's planes continued to take off and land normally today. Fifty flights were cancelled yesterday, but the airline said this was because of a one day strike by a small trades union.

Mr Berlusconi said he still hoped for a "positive outcome" and announced that he would hold a press conference later today.
link (http://www.timesonline.co.uk/tol/news/world/europe/article4781452.ece)

Say goodbye to Alitalia.

The death has arrived.

Thank you to the stupid employees and unions.

:deadthrea Alitalia's dead :deadthrea

Seems like the unions were trying to hold out until the end thinking the government will force the buyers to accept less job cuts thinking Alitalia cannot fail.

...and they' re happy AZ is failed.

Facts about Alitalia, Italy's troubled airline
18 September 2008
Agence France Presse

Alitalia, Italy's virtually bankrupt flag carrier, has received five billion euros in government aid in the last 15 years to keep it flying.

One of the best-known names in global commercial aviation, and 49.9 percent government-owned, it has been in business since 1946-47.

Alitalia symbolised Italy's economic recovery after World War II, becoming the world's seventh largest airline in the 1970s before beginning a long descent which has grown steeper in recent years.

The government sank 4.58 billion euros (6.6 billion dollars) into the company between 1998 and 2005 but it continued to haemorrhage money, recording a loss of three million euros a day in the first half of 2008, with an expected total loss since the start of the year of 800 million euros.

At the end of July it had run up a debt of nearly 1.2 billion euros and shares at the Milan stock exchange have been suspended since June.

The government already bailed out Alitalia in 2004, arranging funding of one billion euros and ordering 3,700 layoffs, some of which were not carried out.

But Rome cannot give further state aid to Alitalia under EU regulations, which bar governments from propping up national companies more than once in a 10-year period.

Alitalia, a member of the Sky Team alliance along with Air France-KLM and 12 other airlines, carried 24.5 million passengers in 2007, or about one third of other major airlines, such as Air France-KLM which holds two percent of its capital, or Lufthansa.

The number of passengers was about the same in 1998.

Alitalia's fleet of 173 planes flies to 84 destinations, 25 in Italy and 59 abroad, 14 of these on other continents.

The company has practically given up its Milan-Malpensa hub despite its interest for business travelers from Italy's financial and fashion capital and is now mainly operating from Rome's Fiumicino airport.

On domestic flights Alitalia has been feeling the heat from Air One, with which it had been supposed to merge had the rescue deal been accepted by the unions.

The new Alitalia would then have held 56 percent of the Italian market.

The company now has about 11,100 employees, having in 2006 transferred 8,300 people to a new entity called Alitalia Servizi, a maintenance and services firm owned 51 percent by state holding company Fintecna.

Hurrah.

All rather predictable, but also entertaining.

Belusconi is still suggesting that Lufthansa/*.* is going to jump in at the last moment. Nor is it officially dead yet, but who in their right mind would buy into it.

http://news.bbc.co.uk/1/hi/business/7622304.stm


However, there are still a few issues. In all the latest news, there was an announcement that Alitalia had lost it's appeal against a previous rulling on illegal state aid. This means that the E300 Million 'loan' will most likely now also be declared illegal. There is then the issue of the current proposal probably falling foul of EU Competition rules and would probably also have gone to court. The break-out of the unprofitable bits probably breaches several EU rules.

There is also the little unnoticed case of a well know Investment agency stating that the company hand cash in hand to last into next year, when in fact the company probably went bust in June judging by the amount of debt it has since run up. A few investors may be asking some pointed questions there, including members of the CAI group.

All rather expensive for the Italian public - the figure was over E2 Billion at the last count. After all the lay-offs and refincing etc, that might come in at over E3 Billion and for what?

So all the more business to be picked up by the good airlines in Europe.

Alitalia may lose licence in days
Published: 2008/09/23

ROME: Aviation authorities may withdraw Alitalia's licence in three to four days if the administrator making a last-ditch attempt to sell it off does not present emergency cost-cutting measures at a meeting yesterday.

After the withdrawal of an Italian rescue bid because of opposition by pilots and cabin crew, the government-appointed administrator made a last bid to attract offers for Alitalia, although previous attempts to find a foreign buyer have failed.

"Alitalia is flying with a provisional licence," the head of aviation body ENAC, Vito Riggio said. - Reuters

Swiss firm says interested in 30 Alitalia planes

ROME, Sept 22 (Reuters) - Swiss investment company AMA Asset Management Advisor said on Monday it was interested in acquiring 30 planes from Alitalia to operate on routes between Italy and Eastern Europe.

The company said in a statement it had proposed buying at least half of Alitalia's fleet of 30 MD-82s and ATR-72s and renting the rest under a "wet lease" contract.

AMA said they would be used to operate passenger flights on at least 11 routes out of Milan's Malpensa airport and Rome's Fiumicino to destinations in the Balkans and Eastern Europe.

Alitalia's government-appointed special administrator made a last attempt to attract offers for the airline or its assets on Monday, after an Italian rescue bid was withdrawn, by inviting offers of interest in all or part of the company by Sept. 30.

The operating licence will be withdrawn this week if no further offers to rescue the business are presented. The authority is looking at what is on the table now and will make the decision based on that in the absense of any new plan (there not having been one by the time of the meeting with the Administrators on Monday):

http://news.bbc.co.uk/1/hi/business/7628705.stm


The Administrator is now looking at offers for the assest of the company, with hints of a new start-up operation out of Milan:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOcRfhHKXU2I

The company said in a statement it had proposed buying at least half of Alitalia's fleet of 30 MD-82s and ATR-72s and renting the rest under a "wet lease" contract.

Why would any airline be interested in buying so many MD80s these days? For today's standards they use just too much kerosine per passenger, which is why all European carriers who still use them such as Iberia and SAS have plans to replace them with newer planes as soon as possible.


Anyway to get back on topic, Alitalia's end now seems to be near, but as I already said a few months ago this might be for the better. This way they have the chance to start completely new again. That also worked just fine for Swissair -> SWISS and Sabena -> Brussels Airlines in the past.

Why would any airline be interested in buying so many MD80s these days? For today's standards they use just too much kerosine per passenger, which is why all European carriers who still use them such as Iberia and SAS have plans to replace them with newer planes as soon as possible.


That is correct. Possibly the only reasoning is that the aircraft will be going very cheap, being both out of date, and part of a fire-sale. There will also be a ready supply of pilots.

There are reports that there have been offers for the maintenance operations and possibly for some of the Airbus aircraft, but nothing for the airline as a going concern.



Anyway to get back on topic, Alitalia's end now seems to be near, but as I already said a few months ago this might be for the better. This way they have the chance to start completely new again. That also worked just fine for Swissair -> SWISS and Sabena -> Brussels Airlines in the past.

I am not sure that that can happen in the case of Alitalia. Swissair was rescued and relaunched by the Swiss Government(s) and with the help of the Swiss Banks. I am not familiar with the details of the formation of Brussels Airlines, but it too was probably rescued from Sabena via refinancing.

In the case of Alitalia, there is now no rescue package and the airline will most likely be broken up for it's remaining assets as the above item seems to indicate. Someone might buy the name and launch a new airline of the same or similar name, but they would have to do all the work of starting from scratch while inheriting all of the bad will against the old airline. That is not good business sense.

It is against EU laws to re-nationalise the airline, but the UK has just recently effectively nationalised one of its banks to stop it from collapsing. That has to be sorted out now with the EU Commission. The collapse of the airline would leave a massive gap in the Italian air travel market. It may therefore just be the case that Berlusconi could resort to a similar measure (even though the Italian Government has made it clear that it will not do so) as a National Expediency, choosing to deal with the 'wrath' of the EU Commission at a later date.

Most other airlines seem to be of the opinion that Alitalia is not worth saving, and are probably ready to move into it's home market. We might expect to see a scramble by the surviving airlines to launch operations that move in on the Italian market and to fill the gaps before anything could be built from the ashes of Alitalia. Lufthansa/*.* has already announced that it will start operations on the Heathrow - Milan sector from Summer 2009. Lufthansa/*.* is also in a strong position with it's SWISS operation. However, I have not seen anything mentioned about new/expanded operations by anyone else into Rome yet.

Today is the deadline for the Administrator to come up with a rescue plan that satisfies the Italian Civil Aviation Authority:

http://news.bbc.co.uk/1/hi/business/7634981.stm


If the airline was to be grounded it would be difficult to recover lost business no matter what goes on until the Administrator's own deadline of the 30th September for new offers to be presented:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8l9ZgRzyWIw


However new offers involving other airlines are unlikely to materialise, the view of Willy Walsh perhaps reflecting the industry's opinion of Alitalia:

"In its current form, I don't think anyone will touch Alitalia,'' Walsh said. "It's a mess, and the scale of restructuring that is required is beyond the capacity of most management teams":

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aAqgEHGwcsTo


If that is the case, CAI would have a very large problem on its plate sorting the airline out, and that is without any airline experience amongst the members of the investment group.

That said, CAI seems to have made some concessions to the unions, so Berlusconi may be able to pull something out of the bag yet:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a8l9ZgRzyWIw

Alitalia union set to back bailout, hopes revived

ROME, Sept 25 (Reuters) - Italy's biggest union looked set to back a sweetened investor rescue of Alitalia on Thursday, spurring hopes the bailout will be salvaged before the bankrupt airline loses its licence to fly.

Pilot and flight assistant unions that had bitterly opposed the deal also signalled a possible change in stance by convening a meeting of their members citing "new and interesting facts".

Unions gathered to hold talks at the prime minister's office on Thursday morning, hours before Alitalia's bankruptcy commissioner must present a rescue plan to aviation authorities or have its operating licence revoked.

The Cgil union -- Italy's biggest -- is set to back the sale of Alitalia assets to Italian investor group CAI after it agreed to concessions on salaries and jobs after a flurry of meetings on Wednesday, a source close to the talks and Italian media said.

CIGL boss Guglielmo Epifani also said Wednesday that the talks might be revived.

CAI withdrew its offer for Alitalia assets last week after Cgil and unions representing pilots and flight assistants cried foul over the deal. The investor group has not formally returned to the fray, but is expected to do so if unions get on board.

Hopes the pilot and flight staff unions could also be persuaded to change their mind rose after they held talks with Prime Minister Silvio Berlusconi's top aide late on Wednesday.

Top officials from two major pilot unions -- who were quick to attack CAI's rescue plan last week -- declined to comment after the late-night talks, calling it a "delicate moment".

Four unions representing pilots and flight staff have convened a meeting of their members for Thursday afternoon, the head of the Avia flight assistants union Antonio Divietri told reporters.

He said indications that an industrial partner will likely arrive soon "changed the situation", in an indirect reference to reports that Air France-KLM was in talks to join the CAI consortium with as much as a 25 percent stake.

Major Italian newspapers like Corriere della Sera and La Repubblica ran banner front-page headlines saying "Alitalia: the deal is near", with the former declaring that "a deal has never been closer".

However, the attempted sale of Alitalia, which has sputtered on for 19 months, has made a mockery of previous promises that a deal to settle the airline's fate is around the corner.

An initial auction to sell the carrier failed when all bidders pulled out, while a subsequent takeover by Air France-KLM fell apart due to union opposition.

This time, Alitalia risks having its flights grounded next week if it is unable to present a rescue plan or declare it has enough funds for the next three months -- which the bankruptcy commissioner has already said is a luxury it does not have.

What a waste of time and money!

Alitalia prefers German partner

THE long-running saga over the future of Alitalia looks like finally reaching a resolution, with an Italian 16-strong consortium, named CAI and led by Roberto Colaninno, poised to take over. The final piece in the jigsaw will be the selection of a foreign minority shareholder partner.

The Italian carrier was placed into receivership last month, and has been allowed to carry on operating, despite breaking EU financial rules on both government aid and cash reserves.

Italy’s prime minister, Silvio Berlusconi, had killed off a take-over by Air France-KLM in May, insisting on an ‘Italian solution’ to the problems.

The takeover by CAI was finally approved in late September by the airline’s nine unions, although the E1 billion plan encompasses some 3,000 redundancies. The CAI takeover is due to be completed by late October.

Under the agreement, CAI will purchase the Italian government’s 49.9 per cent stake, before merging the profitable parts of the business with Italy’s second largest airline, Air One – thus creating a new airline entity. The unprofitable parts of Alitalia will be liquidated and Alitalia Cargo will be sold.

Meanwhile, Lufthansa appears to have taken the lead in the race to become the airline’s foreign partner. Italian trade unions and politicians, including Berlusconi, have indicated that they favour a deal that would give the German carrier a minority stake in the airline.

Rival for the partnership role, Air France-KLM, has expressed a preference for a major hub in Rome by moving many of the operations away from Milan. But this plan has angered unions and politicians, who prefer the Lufthansa model of smaller dispersed hubs.

While Lufthansa remain favourites and AF-KLM remain a viable option, British Airways have also expressed an interest in becoming the airline’s partner – although would not take a stake in the airline.

BA’s chief executive, Willie Walsh (pictured), said that “a partnership with Alitalia is certainly possible, if the CAI investor group restructuring really succeeds”.

Walsh is however, also actively pursuing a stake in bmi, the second largest operator at its London Heathrow base.

The major attraction for all three airlines in a purchase of Alitalia, is access to the lucrative market especially in the north of the country and the value of Alitalia’s slots at Europe’s major airports. Since the introduction of the EU-US ‘open skies’ agreement, the value of slots at many major hubs has soared. Alitalia’s 10 slot pairs at London Heathrow alone are now estimated to be worth E300 million.

BA discusses Alitalia link
U.K. airline explores possible partnership with Italian group
20 October 2008
The Wall Street Journal Europe

LONDON -- British Airways PLC is discussing a potential commercial partnership with the airline being created from Italy's insolvent Alitalia SpA but won't take an equity stake, BA Chief Executive Willie Walsh said in an interview.

Europe's fragmented airline industry appears to be accelerating its consolidation efforts as carriers come under financial pressure because of high oil prices and the threat of recession.

BA, which so far has remained financially sound despite declining traffic, wants to participate in this consolidation -- but not at any price.

"There's absolutely no shortage of airlines out there that we could pursue and acquire, but why would you want to do it?" Mr. Walsh said. "Most of these airlines are available because they're in a mess."

Italian investors grouped into a company called Compagnia Aerea Italiana, or CAI, plan to buy Alitalia's newer planes and airport slots and merge them with smaller local rival AirOne SpA to create a new airline. Alitalia was placed under bankruptcy protection in August.

Because CAI's managers are new to the airline industry, however, they want one of Europe's top carriers involved in the restructuring process. Germany's Deutsche Lufthansa AG and Air France-KLM SA are also looking into the possibility of partnerships with CAI.

Mr. Walsh said he met on Wednesday with Rocco Sabelli, the executive who would run the new Italian airline. "If successful, it would definitely be worthwhile . . . having a relationship with them, but we're not looking to invest," Mr. Walsh said.

Lufthansa and Air France have both expressed interest in buying a minority stake in CAI.

Mr. Walsh said that from BA's experience, investment isn't necessary for a successful commercial partnership. Nonetheless, CAI's investors are also hoping to raise money through the sale of equity in the relaunched airline.

A CAI spokesman said Air France and Lufthansa better understood CAI's interest in attracting an equity and commercial partner. "Talks with British Airways have so far been limited to a commercial partnership, which falls somewhat short of CAI's overall requirements," a CAI spokesman said. Mr. Walsh said not investing could be an issue in his talks.

BA and its big European rivals have been busy. BA and its longtime partner, Spain's Iberia Lineas Aereas de Espana SA, in July announced plans to merge.

Mr. Walsh said talks on the deal "are moving slowly, but they are moving." BA Chairman Martin Broughton recently said he expects to close the deal by next spring. "We will move at the pace that makes sense," Mr. Walsh said.

Lufthansa officials recently agreed to buy a minority stake in the parent of small carrier Brussels Airlines and have said they will exercise an option to acquire closely held BMI British Midland Airways Ltd., a much smaller carrier than BA.

Lufthansa and Air France-KLM are also competing to be selected as the preferred bidder for a minority stake in troubled Austrian Airlines AG, according to people familiar with the process. The airline is being sold by the Austrian government.

Mr. Walsh said BA had explored the possibility of bidding for Austrian but decided not to. BA also bid for Brussels Airlines against Lufthansa, Mr. Walsh said, but hadn't pushed hard.

---

Dana Cimilluca contributed to this article.

Alitalia commissioner says has liquidity - source

ROME, Oct 20 (Reuters) - Alitalia has enough liquidity to operate until the start of December, the Italian airline's bankruptcy commissioner told trade unions on Monday, according to a union source present at the meeting.

The commissioner, Augusto Fantozzi, also told the unions that he hoped to wrap up the sale of Alitalia assets to the CAI investor group by mid-November, the source told Reuters.

CAI plans to merge the profitable parts of Alitalia with domestic rival Air One. It is looking for a partner abroad.

Alitalia's net debt at the end of August stood at 1.219 billion euros ($1.64 billion), up from 1.159 billion euros at the end of July, the company said in a statement.

At the end of August the airline had liquidity of 267 million euros, down from 338 million euros at the end of July.

Alitalia passenger numbers down 28 pct in Sept

ROME, Oct 22 (Reuters) - Passenger numbers at Alitalia were down 28 percent in September year-on-year, as the Italian airline teetered on the brink of bankruptcy, data from the Association of European Airlines revealed on Wednesday.

Alitalia is operating under a bankruptcy commissioner who has said the airline has enough liquidity to operate until the start of December, according to union sources.

The commissioner, Augusto Fantozzi, is in charge of selling Alitalia assets to CAI, a group of Italian investors.

Alitalia's passenger numbers have suffered from uncertainty about the airline's future and unpredictable strikes.

Valuation Of Alitalia Twice As Much What CAI Expected -Report
26 October 2008
DOW JONES NEWSWIRES

Banca Leonardo and Rotschild valuations carried out on Alitalia SpA (AZA.MI) show the airline is worth twice as much what the 16-member Italian investor group CAI had anticipated, Corriere della Sera reported Monday.

Recent press reports suggested that Alitalia's value ranged between EUR700 million and EUR900 million.

CAI will meet with unions on Monday to discuss the new contracts for those staying on at the new Alitalia as well as the 3,350 job cuts to be carried out by the buyer. CAI will hold its shareholders meeting on Tuesday to deliberate on the value of the capital hike and the choice of an industrial partner.

Alitalia has allegedly enough liquidity to carry on until Nov. 15, the report said.

Roberto Colaninno, chairman of Piaggio SpA (PIA.MI), which is leading CAI, said the group has already secured a capital increase of just over EUR1 billion and that the choice of a partner will be made by November, the report said.

Alitalia's industrial partner will have a board member and no more than a 20% stake, which will be sold for a price to be added to the EUR1 billion that will be put forward by CAI, he told the paper.

CAI Alitalia bid depends on EU position -source

ROME, Oct 28 (Reuters) - The Italian investors who have agreed in principle to buy Alitalia will make their bid conditional on getting acceptable positions from unions and the European Commission, a source close to the talks said.

The board of the CAI consortium will meet later on Tuesday and agree to make a binding bid, but one that depends on the European Union body not making CAI liable to repay a 300 million euro loan the state granted to the airline last May.

The bid will also be conditional on getting an agreement on contractual terms with unions. A five-hour meeting with unions late on Monday failed to secure a deal with workers which CAI had hoped could be clinched ahead of the board meeting.

The CAI chief executive Rocco Sabelli will give a report on the union talks, the source told Reuters.

"According to the agenda, the meeting will elect the new board and agree a mandate for a binding offer for Alitalia which will be conditional on getting the ok from the European Commission," the source said.

The Commission has said the rescue loan might have broken EU rules which ban governments from bailing out their airlines.

If its probe into the matter finds Italy at fault, Alitalia would be forced to pay the money back -- a liability CAI wants to ensure it does not have to take on.

The Commission has said it is likely to conclude its probe in November.

Italy's civil aviation agency Enac confirmed on Monday that CAI had requested a new flying licence for Alitalia.

A second source, close to the matter, said the group sought the new licence in a bid to cut all links with Alitalia in its current form and thereby shield itself from Alitalia's liabilities.

CAI will return to talks on Wednesday with unions which reluctantly agreed last month to back the investor bail-out, seen as the only alternative to letting Alitalia go bust.

Alitalia's bankruptcy commissioner has said the airline may be forced to seek a new loan to keep going if the deal with CAI is not wrapped up by mid-November, since its cash reserves are expected to last only until the start of December.

Under the rescue plan, CAI would buy Alitalia's best performing assets and merge them with those of smaller rival Air One to relaunch it as a smaller carrier which would then seek investment from another European airline such as Air France-KLM or Lufthansa .

Prime Minister Silvio Berlusconi, who opposed the previous government's plan to let Air France acquire Alitalia, has insisted the flag carrier should remain in Italian hands and personally encouraged his business contacts to put together a bid.

Alitalia buyers confident of relaunch by Dec
Published: 2008/11/03

MILAN: Investors bidding for Italian airline Alitalia are confident they can relaunch it by December 1 even though its pilots and flight attendants still reject the deal.

The group, Compagnia Aerea Italiana (CAI), filed a binding offer on Friday after a week of hard bargaining with the airline’s myriad unions.

The group did secure the support of four unions which carry most of the clout.

CAI chief executive Rocco Sabelli told the La Repubblica newspaper yesterday that he hoped those who were still holding out would eventually change their minds. - Reuters

Looks like the newswire edition has more details :
Alitalia buyers confident of relaunch by December

MILAN, Nov 2 (Reuters) - Investors bidding for Italian airline Alitalia are confident they can relaunch it by December 1 even though its pilots and flight attendants still reject the deal.

The group, Compagnia Aerea Italiana (CAI), filed a binding offer on Friday after a week of hard bargaining with the airline's myriad unions.

Although it did not win over the pilots and flight attendants, it did secure the support of four unions which carry most of the clout.

CAI Chief Executive Rocco Sabelli said he hoped those who were still holding out would eventually change their minds.

"I am convinced that in the end we will embark on this adventure of relaunching Alitalia with them," he told the La Repubblica newspaper on Sunday. "By the first of December we can take off."

CAI's offer ended months of national angst over the future of Alitalia, which risked being grounded in coming weeks for lack of funds.

Its pilots and flight attendants had accepted the idea of the takeover, but they rejected the final offer because of the terms and conditions of new labour contracts.

One of their union leaders scoffed at the idea that the new Alitalia could fly without them. "They will put planes in flight with the baggage handlers? I wish them luck," Massimo Notaro of Unione Piloti told the Corriere della Sera newspaper on Saturday.

Regardless of the position of the five recalcitrant unions, CAI Chairman Roberto Colaninno said his group would call each of their members to offer them a job at the new airline.

"We will hire flight personnel using a roll call," he said in an interview published in Sunday's Il Sole 24 Ore newspaper. "We will not surrender ourselves to ... blackmail."

Neither Sabelli nor Colaninno would divulge their offer price for the best assets of Alitalia, but they plan to raise 1.1 billion euros to pay for the purchase and relaunch. Il Sole 24 Ore said CAI was offering around 350 million euros.

FINAL HURDLES

Before it can go ahead with its plans, CAI first needs to get approval from Alitalia's bankruptcy commissioner and a decision is expected in the next two weeks.

CAI also wants to wait for the European Commission to decide whether a 300 million euro loan given to Alitalia by the Italian government broke EU rules banning state aid. In the case that it is seen as illegal, CAI does not want to assume the liability.

Italian newspapers said on Sunday that EU Transport Commissioner Antonio Tajani had proposed relegating the loan to the part of the airline that CAI did not want.

CAI is also on the verge of a deal with Air One, a smaller Italian carrier with which it will merge the new airline. The final touch will be finding a foreign partner, the most favoured candidates being Air France-KLM and Lufthansa. CAI is expected to announce its choice by mid-November.

Angry Alitalia pilots, flight staff eye next move

ROME, Nov 3 (Reuters) - Alitalia pilots and flight staff who have rejected new job contracts offered by a group of businessmen taking over the bankrupt carrier said they would "take any action needed" if their demands are not met.

More than 1,000 Alitalia pilots, flight assistants and other staff gathered on Monday in the dining hall of Rome's main airport to hear union officials speak amid speculation they may launch mass protests or strikes to cripple the airline.

CAI presented a binding offer for Alitalia's best assets last week despite winning the backing of only four major unions out of Alitalia's nine labour groups on new work contracts.

The remaining five unions -- who represent pilot and flight staff -- rejected the contracts arguing they discriminated against mothers with small children or employees with handicapped family members. CAI denies the accusations.

"We received a mandate to take any necessary initiative if the government and CAI show no flexibility," Andrea Cavola of the SDL union told Reuters after the meeting.

He declined to say what type of initiatives were discussed.

The investor group now plans to approach pilots and flight staff directly to offer them a job, with the carrier's relaunch by early December hinging partly on what the employees decide.

Local media reports said the head of the Anpav union Massimo Muccioli was forced to leave Monday's meeting under a hail of boos and insults, in a sign not all pilots and staff supported their unions' decision to oppose the CAI deal.

"I walked into the meeting and found myself before a true and real ambush," Muccioli said.

"Not being able to explain the motives of my union, I had to leave the meeting."

However Cavola said Anpav backed the call for action if CAI does not accept to review the job contracts. (Writing by Deepa Babington; Editing by Hans Peters and Tim Dobbyn)

CAI Ready To Hire Ryanair Pilots If Necessary - Paper
5 November 2008

MILAN (Dow Jones)--CAI, the Italian consortium that is ready to take over the majority of Alitalia SpA (AZA.MI) assets, is going to hire pilots of Irish low-cost airline Ryanair Holdings PLC (RYA.DB) if Alitalia pilots decide not to sign the already offered contract, CAI chairman Roberto Colaninno said Tuesday.

In a report in Italian daily Il Messaggero Wednesday Colaninno is quoted as saying that if necessary the consortium will hire pilots from other carriers, "maybe also Ryanair."

Newspaper Web site: www.ilmessaggero.it

Transport in Italy: Trains v planes
8 November 2008
The Economist

The revived Alitalia will face growing competition

APPARENTLY at ease with risk, the businessmen and bankers who are investing in the phoenix-like rebirth of Alitalia submitted an offer for the airline’s assets to the bankrupt flag-carrier’s administrator on October 31st, even after failing to convince pilots and cabin crew to sign new contracts. But although fuel costs have fallen lately, the outlook for aviation has worsened. The economic slowdown is weakening demand. And now fierce competition is threatening the airline’s services between Rome and Milan--a core part of its business.

On November 3rd easyJet, one of Europe’s leading low-cost operators, began operating four flights a day from Fiumicino, Rome’s main airport, to Malpensa, Milan’s second airport. But an even greater danger to a reborn Alitalia may be that posed by trains. Allowing for journeys to and from the airports and the time needed for check-in, security and boarding, a trip from central Rome to central Milan by plane takes well over three hours. The quickest train takes just over four hours. But on December 15th a 182km (114 mile) section of new track will open between Bologna and Milan, cutting the journey time by about half an hour. And at the end of next year 79km of high-speed track between Florence and Bologna should enter service, reducing the one-hour travel time between the two cities by almost half.

Moreover the threat does not just come from Trenitalia, the state-owned rail operator. Last month Nuovo Trasporto Viaggiatori (NTV), a private-sector operator headed by Luca di Montezemolo, Ferrari’s boss, revealed plans to operate high-speed trains between cities including Rome, Milan, Turin and Venice, starting in 2011, with 13 trains a day between Rome and Milan.

Mr di Montezemolo is sure he and his fellow investors are on to a winner. "Italy is a country made for high-speed trains. There is nothing to be gained from investing in airlines," he says. Intesa Sanpaolo, Italy’s biggest bank, which owns 20% of NTV, agrees with him--up to a point. It is hedging its bet with a large stake in the firm resurrecting Alitalia.

BA boss says it has 'exciting proposition' for Alitalia: report
7 November 2008
Agence France Presse

The chief executive of British Airways has expressed strong interest in a commercial alliance with Alitalia, the Financial Times reported Saturday.

"We believe we have made a very credible and potentially exciting proposition for the new company (Alitalia)," Willie Walsh told the daily business newspaper.

Italian investor group CAI last week submitted a binding offer to take over failing Alitalia for 325 million euros (415 million dollars).

The Italian carrier, which is 49.9 percent state-owned, is losing about three million euros a day and has debts of some 1.2 billion euros.

The new concern will need the participation of an established foreign airline to remain viable and Air France-KLM and Lufthansa are among others to express interest.

The FT quoted Walsh as saying that BA was not interested in investing an equity stake in Alitalia and had been assured by CAI that this would be no impediment to the airlines forming a commercial alliance.

Walsh's comments were published the day after BA announced a 91.6 percent plunge in half-year profits amid tough trading conditions and high fuel prices.

Shares in the airline surged as the figures were better than analysts predicted.

EU approves Alitalia rescue, strikes ground flights

BRUSSELS/ROME, Nov 12 (Reuters) - The European Commission on Wednesday approved an Italian bailout of Alitalia and said the airline's new owners would not have to repay an illegal government loan, clearing a major hurdle in a deal to revive the carrier.

But Alitalia employees opposed to the CAI investor group's 375 million euro ($473.4 million) takeover -- which is contingent on EU approval -- continued protests against the deal for a third day, forcing the cancellation of 50 flights.

The Commission determined a 300 million euro loan to the airline in April was illegal state aid, but the EU transport commissioner said the obligation to repay it would rest with Alitalia's assets languishing under bankruptcy rather than CAI.

"The debts have to be paid back by the old Alitalia," EU Transport Commissioner Antonio Tajani, a former aide to Italian Prime Minister Silvio Berlusconi, told a news conference.

CAI was keen to avoid having to repay the loan, and Italy's government had sought to ensure that CAI was protected, by stating that any repayment obligation should be tied to those Alitalia assets not being acquired by the investor group.

The Commission said Alitalia's operations must be sold to CAI -- the only bidder in the airline's third attempt at selling itself -- at market price, to ensure creditors get their money back.

PROTESTS FLARE

Alitalia filed for bankruptcy in August after two failed attempts to find a buyer, weighed down by high labour costs, frequent strikes, rising oil prices and mismanagement.

CAI's offer -- which allows it to cherry-pick Alitalia's best assets, while leaving the rest to the Italian state -- must also be approved by Alitalia's bankruptcy commissioner. He has hired two independent advisers to value the airline's assets.

CAI offered 275 million euros for Alitalia's core flight operations, 100 million euros in a mix of cash and debt for its various units, and will take on debt worth 625 million euros.

Once the takeover is wrapped up, CAI is expected to choose either Air France-KLM or Lufthansa as a foreign partner. The chosen airline will likely enter with a 20 percent stake.

CAI is pressing ahead with its offer despite resistance from pilots and cabin crew unions, who reject new work contracts proposed under the takeover as discriminatory against workers with disabled family members and small children.

CAI denies the accusations, and says the unions are trying to dictate whom to hire.

Protests that cancelled more than 200 flights this week entered their third day on Wednesday, causing more misery for travellers, and prompting Alitalia to order its lawyers to start legal proceedings over the disruption.

Berlusconi, who has made salvaging Alitalia a key part of his third term in office, was quoted in the Corriere della Sera newspaper as saying that the situation at Alitalia was "intolerable", and promising to prosecute the protesters.

EU says Alitalia must pay back 300 mln euro loan

BRUSSELS, Nov 12 (Reuters) - Alitalia, not CAI, must pay back a 300 million euro ($379 million) government loan that the European Commission says was illegal, the EU Transport Commissioner said on Wednesday.

The European Commission confirmed earlier on Wednesday it had given Italy the go-ahead to start selling Alitalia assets to the CAI investor group.

"The debts have to be paid back by the old Alitalia," Antonio Tajani told a news conference. "The loan has to be paid back by Alitalia, by the airline itself."

Alitalia protests continue, govt eyes legal options

ROME, Nov 13 (Reuters) - Protests by Alitalia employees opposed to a takeover by Italian businessmen stretched into a fourth day on Thursday, cancelling more than 20 flights and prompting authorities to mull legal options to end disruptions.

A group of Alitalia workers held an impromptu 24-hour strike on Monday and have since been following a strict "work-to-rule" protest that has caused delays, cancelled nearly 300 flights and heaped misery on travellers across Italy.

Alitalia's pilot and cabin crew unions have been up in arms over the planned introduction of new work contracts after the takeover by the CAI investor group, but they too have distanced themselves from the latest protests, blaming them on a small group of renegade workers.

Italy's centre-right government, which backs the CAI takeover, has struggled to get the protesters back to work, and the labour minister urged public prosecutors to intervene as Italian television played images of frustrated travellers.

Local media reports said the dead body of a woman, due to be flown to Albania, was still languishing in Rome's Fiumicino airport due to the protests, while Monday's strike cancelled a flight carrying 10 billion euros for the Bank of Italy.

The precious cargo later took off on a government aircraft.

"At this point it's a question of public order, because from my point of view there has been illegal behaviour," said Labour Minister Maurizio Sacconi. "The work-to-rule protest should be looked at carefully by prosecutors because the law is not to be followed just to the letter."

An Italian commissioner overseeing strikes said the "work-to-rule" protests were just as illegal as Monday's wildcat strike.

Italy's civil aviation agency Enac also fined Alitalia 250,000 euros over the lack of assistance provided to passengers during the disruption this week, and is mulling other penalties against the airline, Enac spokeswoman Loredana Rosati said.

The CAI group of top Italian businessmen is proceeding with the takeover -- which foresees it cherry-picking Alitalia's best assets, while leaving the rest to the Italian state -- despite the resistance, and won EU approval for the deal on Wednesday.

CAI has offered 275 million euros ($343.5 million) for Alitalia's core flight operations, 100 million euros in a mix of cash and debt for its various units, and will take on additional debt of 625 million euros.

Once the deal is wrapped up, CAI is expected to choose either Air France-KLM or Lufthansa as a foreign partner to enter the group with a 20 percent stake.

Italian daily MF on Thursday, in an unsourced report, said CAI had chosen Air France-KLM and already informed the Italian government, although an official announcement will not be made until Dec. 2, after Alitalia's relaunch.

Air France-KLM, which faces its own four-day pilot strike from Friday, declined to comment. A CAI spokesman was not immediately available to respond.

Alitalia: CAI Signs Deal With Largest Unions To Hire Workers
14 November 2008

MILAN (MF-Dow Jones)--The Italian investor group buying Alitalia SpA (AZA.MI) Friday came a step closer to relaunching the troubled carrier when it signed an agreement to hire workers represented by Italy's main labor unions, the unions said Friday.

Italy's four largest unions agreed to a framework contract deal with CAI, the investor group buying Alitalia, at the end of October, leaving five, smaller unions on the sidelines and striking.

Alitalia strike hits more than a hundred Rome, Milan flights
17 November 2008
Agence France Presse

More than 100 Alitalia flights from Rome and Milan were cancelled Monday as the airline entered its eighth day of a strike, the airport news agency Telenews reported.

Rome-Fiumicino airport was worst hit, with 69 flights cancelled for the day. Although the action hit mainly internal routes, some international flights such as the Rome-New York service were also hit.

Another 40 flights were cancelled at Milan-Linate airport.

The latest cancellations came a day after some 60 flights by the troubled airline were scrapped at the two airports because of the strike by pilots and other staff.

They are protesting a takeover deal by investor group Italian Air Company (CAI), which would involve the loss of 3,250 jobs and revised contracts for the pilots and other air crew.

The group made a binding offer last month for the air passenger transport activities of Alitalia, which was put in special administration in August.

The airline, which is 49.9 percent state owned, is losing about three million euros (3.8 million dollars) a day.

Italy's government has said it will seek disciplinary sanctions for the workers and unions involved.

Alitalia to lose 1 bln euros in 2008, takeover sealed

ROME, Nov 20 (Reuters) - Italian airline Alitalia will lose $1.25 billion in 2008 but a pending takeover by a group of Italian businessmen could revive its fortunes, the administrator overseeing its bankruptcy said as he signed off on the deal.

As final plans to sell Alitalia to the CAI group are wrapped up, administrator Augusto Fantozzi urged more Italians to fly the airline that is canceling more than 100 flights a day due to protests by employees against the deal.

"I often receive expressions of affection for Alitalia by Italians abroad," he told a news conference after approving the takeover. "I wish more Italians here would do the same."

CAI will pay 427 million euros ($534.8 million) in cash and take on debt worth 625 million euros to buy Alitalia's best assets, while the airline's remaining debt and unprofitable units will be taken on by the Italian state, Fantozzi said.

"It's a sale. Believe me, it's not a donation," Fantozzi said, brushing off criticism that the government-backed deal was designed to privatise the carrier's expected future profits while leaving its debts on the shoulders of Italian taxpayers.

The Italian government and the European Commission have already approved the sale, leaving labour protests the only hurdle remaining before CAI. But union anger has shown little sign of halting the deal, and CAI has already began approaching Alitalia workers individually to hire them.

The deal with CAI will close on Nov. 30, Fantozzi said, adding that any issues related to Alitalia will be the investor group's responsibility after that date, even if the official relaunch of the airline is delayed.

CAI, a group of 16 top Italian business names formed after Prime Minister Silvio Berlusconi urged Italian entrepreneurs to save the money-losing carrier, plans to reinvent Alitalia as a smaller, more efficient airline.

That comes after a painful two-year hunt for a buyer that included a failed auction and the collapse of a planned deal to be bought by Air France-KLM, leaving the airline on the brink of liquidation more than once.

It filed for bankruptcy in August, crippled by high labour costs, strikes, surging oil prices and political meddling.

Alitalia is expected to post an operating loss of 1 billion euros in 2008, on revenue of 3.7 billion euros, Fantozzi said.

CAI is also expected to pick either Air France-KLM or Lufthansa as a foreign partner to give Alitalia operational backing and buy a 20 percent stake in the carrier.

Fantozzi said either partner would be suitable for the airline, but that the decision rested with CAI. He said CAI would ensure that Alitalia, unlike in the past, "will have a price structure comparable with other airlines."

He said Alitalia's load factor, the indicator of how well it manages to fill its flights, had been falling for years, and had "understandably collapsed" in recent months.

"I suppose that an international alliance will aim at ensuring a satisfactory load factor," he said.

Italian media say the French airline is likely to edge out its German rival, but sources close to CAI have cautioned that no decision has been made so far and talks continue.

Alitalia creditor's staff protest in Rome
21 November 2008
Agence France Presse

Around 100 employees of Alitalia's creditors protested Friday at Fiumicino airport in Rome over the Italian flag carrier's unpaid debts, Telenews agancy reported.

Calling themselves the "silent victims" of the failing airline, they hoisted banners saying: "We get no redundancy benefits, we are only suppliers" and "We worked for Alitalia. Now we want to be paid."

On Thursday, Augusto Fantozzi, Alitalia's bankruptcy commissioner, said the airline currently owes 3.2 billion euros (four billion dollars).

The Italian government on Wednesday gave the go-ahead for Alitalia, which was on the verge of bankruptcy, to be sold to a group of investors for 1.052 billion euros.

The assets will be sold to the Italian Air Company (CAI), an investor group set up in an emergency move in August to relaunch the national airline.

While outstanding debts will be paid off once unwanted assets are sold off, Fantozzi has stated that the amount raised will not be enough to pay all creditors.

"New" Alitalia Launch Date Slips To Mid December -Report
23 November 2008

MILAN (Dow Jones)--The new Alitalia SpA (AZA.MI), to be launched by investor consortium Compagnia Aerea Italiana (CAI), aims to start operations Dec. 15, and not on Dec. 1 as CAI originally planned, Il Corriere della Sera reports in its online edition Sunday.

According to Corriere, which cites sources in CAI, the delay is due to operational problems which need to be resolved and which make a Dec. 1 launch "difficult."

"We're doing everything we can," the CAI sources told Il Corriere, "...there are problems which don't depend on us."

On Saturday, daily Il Messaggero reported that CAI was likely to launch the new Alitalia in January.

On Monday, the welfare minister is expected to give the green light to layoffs from the old Alitalia, according to weekend press reports, a necessary step which will allow CAI to proceed with its own hiring process.

CAI is expected to hire just over 10,000 former Alitalia employees to relaunch the beleaguered former Italian flag carrier. Smaller domestic rival Air One SpA is also to be acquired and merged with Alitalia, according to the CAI plan.

Newspaper Web site: www.corriere.it

Air France, Lufthansa still in running for Alitalia

ROME, Nov 25 (Reuters) - Both Air France-KLM and Deutsche Lufthansa remain in talks to buy a stake in Alitalia, the head of the group buying the Italian airline said, rejecting speculation that the French carrier had already sealed the deal.

"We are concluding our considerations on a foreign partner," CAI Chairman Roberto Colaninno told reporters after the group's board approved raising up to 1.1 billion euros ($1.42 billion) to finance the acquisition of the bankrupt Italian carrier.

CAI, a consortium of 16 top Italian business groups, has agreed to buy Alitalia's best assets for 427 million euros in a bid to relaunch it as a smaller, more efficient carrier.

The group plans to choose a foreign partner -- either Air France-KLM or Lufthansa -- to enter with a 20 percent stake and provide Alitalia operational backing on an international level.

Italian media have previously reported that Air France-KLM had already been chosen as that partner, but Colaninno said talks were continuing with both European rivals.

The prospective roles of both Fiumicino airport in Rome and Malpensa in Milan under an alliance with either would play a key part in the decision on which partner is chosen, he said.

Plans that affect airport hubs are controversial in Italy, and Alitalia's decision last year to cut back at Malpensa set off a backlash from politicians and workers in Italy's north.

The choice of Lufthansa as a foreign partner would be expected to help Malpensa remain a major hub for Alitalia, while Air France-KLM would be expected to favor Rome's Fiumicino airport.

"The considerations are ... so that Italian air transport can satisfy demand from Italy's north, from the Po valley, and so Malpensa will become an important point of reference for international, intercontinental and national flights," he said.

"As for Fiumicino, it will concentrate on Mediterranean traffic with intercontinental, international and national flights."

Colaninno declined to give a date on which CAI would take over Alitalia, after media speculation that the airline's relaunch could be delayed from Dec. 1 to closer to Christmas.

Alitalia's bankruptcy commissioner has however said that the airline would be CAI's responsibility as of Dec. 1 even if its rebirth were delayed.

Alitalia's two-year hunt for a buyer has been littered with delays, missed deadlines and sudden changes in fortunes. ($1=.7767 Euro)

Alitalia suitor Lufthansa sets up Italian airline

MALPENSA AIRPORT, Italy, Nov 26 (Reuters) - German airline Lufthansa will set up its own Italian airline early next year, even as it courts Alitalia, as the battle to make inroads into the lucrative Italian air travel market heats up.

Lufthansa, which is vying with arch-rival Air France-KLM to strike an alliance with Italy's bankrupt national carrier , said its move did not mean it was "closing the door" on its ambitions to tie up with the Italian airline.

The German carrier was also closing in on its planned acquisition of a government stake in loss-making Austrian Airlines , which Austrian state holding company OeIAG said it planned to sign with Lufthansa next week.

If Lufthansa did lose out to Air France-KLM on Alitalia, its new airline would allow it to pressure Alitalia on its home-turf just as the Italian carrier tries to reinvent itself after years of losses and strikes.

"This move puts the Italians under pressure to act," LBBW analyst Per-Ola Hellgren said. It also sent a message to the CAI group buying Alitalia that Lufthansa could set up competing operations if it is not picked as foreign partner, he said.

The CAI consortium of top Italian businessmen is buying Alitalia for 427 million euros ($553.5 million) and working to relaunch it as a smaller, more efficient carrier next month.

The airline picked as foreign partner is expected to buy a 20 percent stake, though Lufthansa Chief Executive Wolfgang Mayrhuber said a price or size of stake had yet to be discussed.

At a news conference at Malpensa airport outside Milan, where plans for the new airline were announced, Mayrhuber said the Lufthansa ought to be selected as partner because of its multi-hub strategy and high traffic between Germany and Italy.

Lufthansa's new airline, which will fly under the "Lufthansa Italia" brand and seek an Italian operating licence, will be based around Milan's Malpensa hub, where Alitalia has cut back sharply in a bid to reduce costs and turn itself around.

It will fly to eight European destinations, including Paris Charles de Gaulle and London Heathrow. The initial flights will take off in February and the airline will start with a fleet of six Airbus aircraft.

Malpensa will become part of Lufthansa's multi-hub system under the plans, said Giuseppe Bonomi, chairman of Milan's airport operator SEA.

Fearing job losses and a hit to the local economy, Bonomi and other Milan officials and politicians had waged a bitter fight to force Alitalia to rethink its plans to reduce its presence at Malpensa.

Lufthansa's ambitions in Italy are part of its broader plans to grow amid a cut-throat battle in the European aviation market to survive as a recession bites.

The carrier is not actively seeking to sell parts of subsidiary BMI, Mayrhuber said.

He also said he would be "extremely surprised" if the EU blocked a purchase of Austrian Airlines -- where it is the only remaining bidder after Air France and Russia's S7 dropped out of the race.

Austrian state holding company OeIAG said on Wednesday it expected to rubber-stamp the sale in a supervisory board meeting on Dec. 5 and to sign it on the same day.

As the deal involves the Austrian government assuming 500 million euros of debt from Austrian Airlines, it needs EU approval for this form of state aid on top of a review of the impact on competition.

^^
Contestualmente con la conferenza stampa che si è svolta questa mattina a Malpensa (Sala Albinoni al T1), è finalmente comparsa una intera sezione dedicata a Lufthansa Italia sul sito di LH.

Ecco come si presenta:

http://img300.imageshack.us/img300/9578/picture2pw7.png

Nella sezione vi sono tutte le anticipazioni grafiche della flotta: livrea, gli interni e le divise.

Ecco gli esterni, con la livrea:
http://img184.imageshack.us/img184/5329/0998021664k1jo0.jpg

http://i245.photobucket.com/albums/gg70/hal1950/0998_02_1703k1xx.jpg

http://img404.imageshack.us/img404/8316/0998021717k1ai2.jpg

Gli interni, le divise degli AA/VV:

http://i245.photobucket.com/albums/gg70/hal1950/0998_03_1571kxx.jpg

http://i245.photobucket.com/albums/gg70/hal1950/0998_03_1521kxx.jpg

http://i245.photobucket.com/albums/gg70/hal1950/0998_03_0704kxx.jpg

http://i245.photobucket.com/albums/gg70/hal1950/0998_03_0285kxx.jpg

Si, quella scritta Italia è stupenda.

Qui un altro dettaglio sul sito LH:

http://img139.imageshack.us/img139/4152/picture3hs9.png


http://konzern.lufthansa.com/de/img/banner/lufthansa-italia_l.gif http://konzern.lufthansa.com/global/img/ueber_uns/lufthansa-italia/head.jpg

New brand for Italy

Direct flights from northern Italy with Lufthansa Italia available for booking





http://konzern.lufthansa.com/global/img/ueber_uns/lufthansa-italia/body1.jpg



http://konzern.lufthansa.com/global/img/verantwortung/oeko-effizienz/mayrhuber_sm.jpg

http://konzern.lufthansa.com/en/html/ueber_uns/lufthansa-italia/index.html

^^
Bravissimo!!!

http://www.nationalflaggen.de/shop/catalog/images/freundschaftpin-deutschland-italien-pin.jpg

:cheer::cheer::cheer::applause::applause::applause::cheer::cheer::cheer:

New Alitalia owners not ready to take over on time
27 November 2008

ROME (AP) - The Italian investors taking over bankrupt Alitalia are not ready to assume control on Dec. 1 as planned, but the airline will continue to operate, the country's aviation authority said Thursday.

The aviation authority's confirmed the handover would be delayed, as had been reported in the media, just days after Alitalia's extraordinary administrator Augusto Fantozzi said his job would be finished at the end of November.

The authority, ENAC, said in statement that the group of investors would not launch the new Alitalia on Dec. 1 as originally scheduled, saying the group was "in a phase of finalizing some administrative and technical points."

The investors formed CAI Compagnia Aerea Italiana (Italian Air Company) to relaunch Alitalia as a leaner, more efficient airline.

They agreed to a deal worth euro1.052 billion ($1.33 billion), with the group paying euro427 million in cash and taking on euro625 million in Alitalia debts.

Alitalia Buyer CAI Purchases Air One For Circa EUR300M-Report
28 November 2008

MILAN (Dow Jones)--Compagnia Aerea Italiana (CAI), which is buying assets from Alitalia SpA (AZA.MI) as part of plans to relaunch the beleaguered Italian carrier, on Thursday agreed to purchase smaller Italian carrier Air One SpA for "less than" EUR300 million, daily MF-Milan Finanza writes Friday.

According to the paper, which didn't cite sources, the deal between CAI and privately-held Air One was reached Thursday.

The purchase or Air One, which is to be merged into a "new" Alitalia created by CAI, is part of a CAI plan to relaunch Alitalia as a smaller, leaner airline.

In a separate report Italy's Il Messaggero writes that in 2013, when the new CAI-Alitalia will be operating at full capacity, the airline will transport 14.9 million passengers each year from Milan's Malpensa airport and 13.9 million passengers from Rome's Fiumicino airport.

The company will operate 73 routes from Milan and 44 from Rome, according to the paper.

Funds delay holds up Alitalia deal closure-source

ROME, Dec 1 (Reuters) - The closing of the sale of Alitalia's best assets has been delayed because the CAI investors' consortium is unable to raise and deliver the funds before Dec. 12, a source close to the matter said.

The administrator overseeing the Italian airline's bankruptcy told state radio the 427 million-euro ($541 million) purchase, expected to close on Nov. 30, had been delayed for technical reasons.

Augusto Fantozzi, told state radio RadioUno that CAI would assume costs related to the bankrupt airline between now and Dec. 12, though the source said the matter was still being discussed.

A period of transition will follow until Alitalia's assets are officially in CAI's possession on Jan. 7, the source said.

The green light from a European monitor trustee -- one of two remaining regulatory approvals needed -- has already been informally given and a formal approval is expected later, the source said.

Alitalia's sale to CAI comes after a difficult two-year hunt for a buyer that included a failed auction and a subsequent deal to sell it to Air France-KLM that collapsed.

The French airline and rival Lufthansa are now in the running to buy a 20 percent stake in Alitalia after it is in CAI's hands.

Alitalia relaunch delayed to after Christmas

ROME, Dec 2 (Reuters) - Italian airline Alitalia's relaunch by a group of Italian businessmen will be delayed until after Christmas to prevent travel disruptions during the peak holiday season, Italy's industry minister said on Tuesday.

He did not specify a date when Alitalia will officially begin operating under the CAI investor consortium's ownership, but the administrator overseeing the airline's bankruptcy said he would ensure Alitalia keeps flying until Jan. 12.

"The start of the new Alitalia will be after the Christmas vacations to avoid the most congested holiday period," Industry Minister Claudio Scajola told reporters in Brussels.

"I don't see any major problems if it becomes operational after 10 to 15 days. With all the problems we've had, this is definitely the least of them."

The relaunched carrier will continue flying under the Alitalia name, and operate roughly 550 flights a day -- or about 68 percent of the schedule it operated earlier this year, said Italy's civil aviation agency chief Vito Riggio.

Alitalia, which operated about 800 flights a day until January, has been flying just 200 flights daily in recent days due to protests by staff against the takeover.

The deal with CAI was initially set to be wrapped up by Nov. 30, but the administrator, Augusto Fantozzi, delayed it until Dec. 12 citing technical reasons.

A source close to the matter said CAI was unable to deliver the funds for its 427 million-euro ($539.9 million) purchase of Alitalia's best assets before then.

A new government decree allows the transfer of Alitalia's assets to CAI to be delayed beyond Dec. 12, but under the condition that all costs, risks and losses related to Alitalia are borne by CAI during the transition period.

The two sides have agreed CAI will pay 24 million euros to cover Alitalia's obligations between Dec. 1 and Dec. 12 and then pay 14 million euros weekly until it takes over.

The deal -- which also includes CAI buying the assets of smaller rival Air One to merge them with those of Alitalia -- still requires approval from Italian antitrust authorities and a European Monitoring trustee before it can become effective.

Italian antitrust approval is expected on Wednesday, on the condition the airline transfers 50 slots devoted to the lucrative Rome-Milan route to other routes connecting the island of Sardinia, a source close to the matter said.

The antitrust agency will also try to insist that the relaunched airline offer at least 10 percent of its flights at prices lower than those offered by Alitalia and Air One before they were combined.

($1=.7908 euros)

What does Lufthansa Italia have to do with Alitalia? Is Alitalia staying around?

Italy's watchdog: 'New' Alitalia can fly but must offer some cheap seats on each flight
3 December 2008

ROME (AP) - A relaunched Alitalia can take off as long as it guarantees that at least 10 percent of tickets on every flight are for cheap seats, Italy's antitrust agency decided Wednesday.

The OK for a "new" Alitalia being launched by Italian investors was granted by Italy's authority on competition and markets after a meeting of its officials.

The investors known as CAI (Compagnia Aerea Italiana or Italian Air Company) will officially take possession of the bankrupt carrier's profitable assets later this month, but the new airline, with fewer routes and aircraft, and a smaller work force, probably will not be launched until January, officials have said.

Under the deal, Alitalia will be combined with its much smaller but chief domestic rival, AirOne.

The antitrust authority said in a statement that the new airline must "guarantee that at least 10 percent of the tickets on every flight make available the cheapest price" based on the price offered by Alitalia and AirOne Group on the same route in the corresponding previous travel season.

That would protect consumers "against the risk of an unjustified price hike following the merger," the authority said.

CAI has agreed to a euro1.052 billion ($1.33 billion) deal to acquire Alitalia's profitable assets, while the unprofitable ones will be sold off.

^^
Bravissimo!!!

http://www.nationalflaggen.de/shop/catalog/images/freundschaftpin-deutschland-italien-pin.jpg

:cheer::cheer::cheer::applause::applause::applause::cheer::cheer::cheer:

:cheers1:

EU's Tajani: Alitalia sale deemed at fair value

BRUSSELS, Dec 4 (Reuters) - A trustee report has found that the sale of Italian national airline Alitalia to investor consortium CAI is at fair market value, EU Transport Commissioner Antonio Tajani said on Thursday.

"According to the assessment by the managing trustees, the sale of the assets of Alitalia, that price in fact corresponds to market prices," Tajani told a news conference.

"The price represents fair market value, so this is in fact at market prices," he said.

Italy's antitrust authority gave conditional approval on Wednesday for the purchase of struggling Alitalia, listing several minor conditions that a source close to CAI said the consortium considered "reasonable".

The authority said it reserved the right to make a new ruling on the deal after Alitalia had chosen its foreign partner, but could pass the decision to European antitrust authorities.

The front-runners to become Alitalia's foreign partner are Air France-KLM and Lufthansa .

The administrator overseeing the airline's bankruptcy has said CAI would pay for the 427 million euro ($539 million) purchase starting on Dec. 12, when the airline's assets would be transferred to it.

Alitalia investor group buys smaller rival Air One

ROME, Dec 11 (Reuters) - Alitalia's smaller rival Air One agreed on Thursday to sell its operations to the consortium buying Italy's flagship carrier, moving the CAI investor group another step closer to its acquisition of Alitalia .

Air One said its president, Carlo Toto, had signed an agreement with CAI Chief Executive Rocco Sabelli to sell Air One and various subsidiaries to CAI, in line with an accord set in August.

Closing will take place by the end of the year. The process of integrating Alitalia and Air One to create "the new flagship carrier" will begin from Jan. 13, the Air One statement said.

Air One said Toto would reinvest 60 million euros in the new airline.

What does Lufthansa Italia have to do with Alitalia? Is Alitalia staying around?

It is born as a consequence of Alitalia (almost) crack and its chose to 'leave' Milano Mapensa in favour of Roma Fiumicino (probably new Alitalia will come back on Milan's airport)

Without that Lufthansa didn't have enough space to create a 'new brand' expressly for Italy chosing Malpensa as referring point

1 month until new Alitalia flies
12 December 2008

ROME (AP) - Italian investors officially took possession Alitalia's profitable assets Friday, a step toward the launch next month of a more efficient, smaller version of the national airline.

The new streamlined Alitalia is launching on Jan. 12 -- some two years after the government started the long and difficult process of unloading its 49.9 percent stake in the bankrupted carrier.

Alitalia never halted flying, but the new airline will have fewer routes and aircraft, as well as employing 12,500 employees rather than the current 20,000.

The Compagnia Aerea Italiana (CAI) led by scooter-maker Piaggio CEO Roberto Colaninno also said that a foreign investor will be chosen by the end of the year to take a minority stake of 20 percent to 25 percent.

"We would like this adventure to start together with an industrial partner," Colaninno told reporters in Rome. CAI officials have been meeting with both Franco-Dutch carrier Air France-KLM and Germany's Lufthansa.

CAI, made of 21 investors, has agreed to a euro1.052 billion ($1.4 billion) deal to relaunch the national carrier.

Rocco Sabelli, chief executive of the investors group, said the new company's initial capitalization will be at least euro1 billion ($1.33 billion) and has a target revenue of euro4.8 billion ($6.4 billion) in 2013. He also said the break-even point is expected by the end of 2010.

Alitalia will have a total fleet of 148 aircraft and will serve 70 destinations, including 34 international and 13 long-haul routes.

The Italian investors are merging the main assets with the country's No. 2 Air One to form a smaller, more efficient airline.

Alitalia owner says rivals still vying for stake

ROME, Dec 12 (Reuters) - Air France-KLM and Lufthansa are still battling it out for a stake of as much as 25 percent in Alitalia , the Italian consortium that bought the bankrupt carrier said on Friday.

Despite media reports that Air France-KLM had already sealed the deal, CAI Chief Executive Rocco Sabelli said the competition was still open. A decision will be made by the year end, with the aim of having a foreign partner in place when Alitalia is relaunched as a smaller carrier on Jan. 12, he said.

"The negotiations are hard and real," Sabelli told a news conference to announce that CAI had formally taken possession of Alitalia's assets on Friday.

British Airways is also in the running to become a partner, but CAI said it favoured Air France-KLM or Lufthansa because they were interested in taking a stake in Italy's national airline, while BA only wanted a commercial partnership.

That comes just a day after Italian Prime Minister Silvio Berlusconi, whose drive to save Alitalia spurred the creation of the CAI group, said he would prefer a foreign rival to strike a commercial alliance with Alitalia rather than buy an equity stake.

CAI Chairman Roberto Colaninno said the talks were for a foreign partner entering with a 20-25 percent stake in Alitalia, although that could be later diluted to 20-21 percent.

CAI, a consortium of top Italian businessmen, came to Alitalia's rescue with a 427 million euro purchase of its best assets to prevent the carrier being liquidated.

The Italian state, which owned a controlling stake in Alitalia, agreed to the offer last month.

CAI on Thursday it said it had also finalised the purchase of tiny Italian airline Air One, whose operations will be folded into those of Alitalia.

Alitalia and Air One will maintain their separate networks until Jan. 12, after which the new airline will operate as an combined entity with a focus on medium and long-haul flights, CAI said.

The new Alitalia should break even on its operating results by the end of 2010 and see its domestic market share rise to 56 percent in 2009 from 30 percent currently, CAI said.

CAI also aims to reduce the average age of Alitalia's fleet to 8.6 years in 2009 from 12.4 years.

CAI's purchase of Alitalia drew union protest, but longtime holdouts -- the Anpav and Avia unions representing flight attendants -- agreed on Friday to join the major unions in backing the deal.

British Airways To Sign Partnership With Alitalia - Report
16 December 2008

MILAN (Dow Jones)--British Airways (BAY.LN) Chief Executive Willie Walsh Tuesday said the carrier is ready to sign a commercial partnership with Alitalia SpA (AZA.MI), reports financial daily Il Sole 24 Ore.

Walsh said British Airways isn't looking to acquire a stake in Alitalia and is discussing the commercial partnership option with Alitalia Chief Executive Rocco Sabelli.

Newspaper Web site: www.ilsole24ore.com

Air France in talks with Alitalia investor group
19 December 2008
Agence France Presse

The Italian investor group that took over Alitalia held talks early on Friday with executives from Air France-KLM, which is eyeing a major stake in the revived airline, the investors said.

Italian Air Company (CAI) chairman Roberto Colaninno and managing director Rocco Sabelli were meeting with the deputy chairman of the European giant, Pierre-Henri Gourgeon, a CAI spokesman told AFP.

CAI has already met executives from British Airways, which is interested in a commercial tie-up with Alitalia, and Lufthansa, which is competing with Air France-KLM for a stake.

The Italian financial daily Il Sole-24 Ore tips Air France as the favourite and said Friday that the meeting in Milan was aimed at finalising a deal.

"The French are interested in acquiring at least 25 percent (of the new Alitalia) with an investment of around 250 million euros (350 million dollars)," the paper wrote.

CAI currently has capital of around 450 million euros pooled from 21 Italian investors "who have promised to provide a total of 900 million by the end of the year," Il Sole said. "So the money from Air France will be invaluable if they want to reach the capitalisation of 1.1 billion euros as decided by shareholders in October."

Even more important is the know-how that the French-Dutch group will bring to the table, the daily added.

CAI has taken over Alitalia's passenger operations, which it is merging with Air One, Italy's number two airline, and the new airline expected to take off in mid-January.

It is to retain 12,500 Alitalia workers while cutting some 3,250 jobs.

Alitalia had a total debt of around 3.2 billion euros and was losing some three million euros a day by the time CAI took it over a week ago.

Air France-KLM had been prepared to assume Alitalia's debt as part of a takeover offer that it withdrew in early April after the breakdown of acrimonious negotiations with the unions.

Berlusconi made Alitalia's plight an issue while campaigning for mid-April elections, vowing that he would keep the carrier in Italian hands and reject a takeover by Air France-KLM.

Rome travelers try to find flights after strike
23 December 2008

ROME (AP) - Alitalia has canceled about 140 flights at Rome's Leonardo da Vinci in the last two days because of a wildcat strike that left holiday travelers stranded, news reports said Tuesday.

The baggage handlers and maintenance staff walked off the job Monday to protest negotiations with CAI, the group of investors that plans to relaunch a smaller, more efficient Alitalia next month.

The strike stranded scores of passengers, with many sleeping on airport benches or standing in long lines Tuesday morning waiting for flights out.

About 100 flights were canceled during the walkout Monday, and another 40 Tuesday as officials tried to reschedule the flights from the day before, the ANSA news agency and other reports said.

Officials at the airport declined to provide numbers. Alitalia officials could not be reached for comments.

Union representatives and management were meeting Tuesday evening in Rome, ANSA said.

Last month, wildcat strikes forced Alitalia to scrap hundreds of flights.

As part of the launch of the new airline, Alitalia formally put 46 aircraft up for sale Tuesday. Advertisements appearing in the Financial Times and other newspapers instructed would-be buyers to place bids by Jan. 29.

Air France-KLM ready to boost bid for Alitalia stake: report
5 January 2009
Agence France Presse

Air France-KLM is prepared to increase its bid for a 25-percent stake in Italian flag carrier Alitalia from 250 million to around 300 million euros (410 million dollars), the newspaper Les Echos reported on Monday.

The newspaper, which did not cite its sources, said the offer was aimed at countering a bid from German competitor Lufthansa.

It said Air France-KLM would agree to raise its offer for the Alitalia stake to "more than 300 million euros." The struggling Italian carrier was due to announce the name of a partner later this week.

"Air France is continuing to work" on this matter," a company spokeswoman told AFP.

Italian press reports have said an accord between Air France-KLM and Alitalia was likely, giving the Franco-Dutch company a 25-percent stake, with an official announcement expected around January 10.

But the head of the Italian Air Company (CAI), an alliance of investors that took over Alitalia last month, was also to meet with Lufthansa representatives Monday, according to Italian media.

A revamped Alitalia, which will keep its name, is scheduled to begin operations on January 13.

The Wall Street Journal, January 8, 2009 :
Alitalia, Air France Close to Finalizing Deal

By LUCA DI LEO

ROME -- Alitalia SpA Thursday looked set to clinch a long-awaited deal to sell a stake to Air France-KLM SA, giving the former ailing state-controlled carrier the large international partner it needs to complete its turnaround.

The stake sale may be finalized in the next few hours after Italian Premier Silvio Berlusconi effectively gave his blessing to it, saying Wednesday that rival suitor Deutsche Lufthansa AG had never made an offer for Alitalia.

The Franco-Dutch airline could approve the purchase of a 25% stake in Alitalia for around €300 million ($407.6 billion) as early as Friday, said a person familiar with the matter. Alitalia's board would then formally approve the sale at a meeting Monday, the person added.

Air France-KLM, the world's largest airline by revenue in 2008, already shares services on some routes with Alitalia via the SkyTeam airline commercial alliance.

Alitalia, dogged by political interference and strike-prone labor unions for years, filed for bankruptcy protection in August. A group of Italian investors led by Roberto Colaninno subsequently bought its potentially profitable assets in a government-sponsored rescue and merged them with Air One, a smaller Italian carrier.

Colaninno Dec. 12 said Alitalia would pick an international partner by the end of 2008 and that the Italian airline would sell a stake of between 20%-25%.

http://online.wsj.com/article/SB123141449066864033.html?mod=googlenews_wsj

Rome airport disruptions caused by ground workers upset with job losses in new Alitalia
8 January 2009

ROME (AP) - Baggage handlers and other ground workers caused disruptions Thursday at Rome's main Leonardo da Vinci airport with a protest action against job cuts that are part of Alitalia's imminent relaunch.

The new, streamlined Alitalia is to start operations next week. The new airline merges the profitable assets of the old Alitalia with the much smaller Air One, and will include a foreign partner.

Air France-KLM emerged as the front-runner on Wednesday after Premier Silvio Berlusconi said Lufthansa, the other main contender, never made a firm offer.

Berlusconi was meeting Thursday with a northern political ally and the Milan mayor, who share concerns about the future of Milan's Malpensa airport. Alitalia already severely reduced flights to and from Malpensa, effectively demoting it as a hub, as it sought to bring costs under control. Northern politicians argue that northern Italy, the motor of the nation's economy, needs to have an international hub.

The new Alitalia will employ 12,500 people -- down from 20,000. Some 3,250 workers are being offered government guarantees of up to 80 percent pay for eight years; some of the others were on short-term contracts that are not being renewed.

Italian media reported that some 400 workers participated in the Thursday protest, reportedly upset that some of their numbers have not been offered jobs by the new management.

Airport officials said some incoming flights were delayed as baggage handling had been blocked by the worker action.

Alitalia-owned art work to go under the hammer

ROME, Jan 11 (Reuters) - Italian carrier Alitalia will auction 163 works of art including some by prominent modern painters that were shown in its aircraft during its 1960s heyday, its bankruptcy administrator said on Sunday.

"At the outset, Alitalia would display works of art to show beautiful things to its passengers," Augusto Fantozzi told Italian television. "There are a number of paintings by important artists that will now be sold at auction."

He did not say how much the art work was expected to fetch or if the paintings had been valued yet.

The paintings were usually small so as to fit inside fuselages, and included some by famous Italian artists such as Renato Guttuso and Futurist painter Giacomo Balla, La Repubblica daily reported last year.

The Italian national airline, which began flying in 1947 and became a proud symbol of Italy's economic prowess in the post-war period, has since fallen on hard times.

Alitalia filed for bankruptcy in August after years of losses due to strikes and inefficiencies. A group of Italian investors bought its best bits and is relaunching the carrier, while its remaining assets are being liquidated.

Alitalia, carrier of popes, is born again

ROME, Jan 13 (Reuters) - Alitalia, the airline that has flown popes, princes and prima donnas, was reborn as a smaller, privately-owned carrier amid chaos on Tuesday as protests by disgruntled employees delayed or cancelled inaugural flights.

Once a symbol of Italy's post-war economic boom, Alitalia filed for bankruptcy last year, succumbing to labour strife, high costs and mismanagement. A group of Italian investors bought its best parts, leaving the rest to the Italian state.

After months of haggling with unions and frenetic talks with politicians seeking to save local airports, Alitalia flight AZ 676 to Sao Paolo took off promptly at 0510 GMT from Milan in the carrier's virgin flight under a new network and new owners.

"We've done it. There's no turning back from the new Alitalia now and all the prophets of misfortune have been silenced," said Labour Minister Maurizio Sacconi, whose government had made saving Alitalia a top priority.

But the airline's first domestic flight took off 20 minutes late and 11 flights at Milan's Linate airport were cancelled because all gates for planes were occupied.

In a reminder of the old challenges facing the reshaped carrier, Alitalia workers wary of the impact from a new alliance with Air France-KLM demonstrated at Milan's Malpensa airport by chanting slogans and waving union banners, causing delays.

At Rome's Fiumicino airport, delays of more than two hours were reported as workers marched outside.

Alitalia's unions have been bickering with its new owners for months, accusing them of not respecting prior agreements. Alitalia CEO Rocco Sabelli said the unions were mainly unhappy with their pick of a new cleaning service.

"I don't have any illusions," Sabelli, who earlier said Alitalia had drawn up an emergency plan for the protests, told La Stampa daily.

"There are problems to be resolved, and there will be plenty more to resolve."

'LA DOLCE VITA' AIRLINE

The new Alitalia maintains the carrier's brand and livery, but its new owners have revamped its flight network, axed a third of the workforce and partnered with larger rival Air France-KLM in a bid to return it to a profit.

With its operations merged with those of smaller rival Air One, Alitalia will fly to 47 foreign and 23 Italian destinations in the new network. It targets increasing its market share to 56 percent from 30 percent and results breaking even in two years.

The airline may relist on the stock exchange in three years, but first needs to fend off growing competition on its home turf from a new high-speed train service and rivals like Lufthansa. It takes off against a backdrop of falling passenger and cargo traffic that has triggered a severe industry crisis.

Italian newspapers published nostalgic pictures of Alitalia's flights during its 1950s-60s heyday, with movie stars like Sofia Loren waving from the landing stairs and stewardesses sporting prim Alitalia-branded hat boxes and designer uniforms.

The airline's stewardesses were dressed by famous Italian designers including the Fontana sisters and Giorgio Armani.

Alitalia first took to the skies on Sept. 16, 1946, in the tumultuous post-war period and later became the preferred carrier of popes and movie stars.

Film diva Anita Ekberg landed in Rome in Federico Fellini's 1960 classic "La Dolce Vita" on an Alitalia DC-6B propeller plane, and Pope Paul VI began the tradition of papal trips on Alitalia by using it on the first flight by a pope in 1964.

But the state-controlled carrier soon became a vehicle for political favours, and its unionised staff, who enjoyed lavish perks, prevented efforts to restructure to meet the 21st century challenges of an aviation downturn and low-cost competition.

"Alitalia died of grandeur," Augusto Fantozzi, who ran it during its bankruptcy told L'Espresso magazine. "It paid triple for everything. To give you an example: it would send three cars to pick up cabin crew, in case the first got a flat tyre and the motor broke down in the second. It was a waste."

Alitalia hit by strike less than a week after new launch: report
19 January 2009
Agence France Presse

Alitalia on Monday cancelled 30 flights, including six to international destinations, due to its first strike since its launch under private ownership less than a week ago, Telenews agency reported.

The airline would only confirm to AFP that four flights had been cancelled, as the SDL union made threats of a fresh strike.

A four-hour strike between 0900 and 1300 GMT was called by the union to protest against recent reforms and job cuts, saying it was concerned about the Italian flag carrier's future.

SDL, which told Telenews that Alitalia cancelled some 30 flights to Algiers, Moscow, Paris, Cairo, Malta and Istanbul, said a number of flights had suffered delays, without specifying how many.

It has threatened another 24-hour strike at an unspecified date.

Alitalia flew off under its first day of private ownership last Tuesday, after it was taken over by a group of prominent Italian business leaders and under an alliance with Air France-KLM, which has a 25 percent stake.

The streamlined company run by CAI has some 12,000 employees after shedding more than 3,000 jobs. It has been merged with domestic rival Air One.

Its fleet of 148 planes will fly 670 routes a day, down more than a third from the 1,050 routes flown by Alitalia and Air One each day a year ago.

Union actions forced the airline to cancel hundreds of flights last year, creating openings for aggressive rivals, notably the budget airlines easyJet of Britain and Ireland's Ryanair.

New 24-hour strike called at Alitalia: union
23 January 2009
Agence France Presse

An Italian union has called on Alitalia staff to step up strike action in protest at working conditions following lay-offs at the newly privatised airline, a statement said Friday.

"After the four-hour strike on January 19, which did not bring any positive response from management, the (SDL union) has called for a new strike on March 4," the union statement said, saying it would "last for 24 hours" this time.

Alitalia on Monday cancelled 30 flights, including six to international destinations, due to its first strike since its launch under private ownership less than a week earlier, Telenews agency reported.

The airline would only confirm to AFP that four flights had been cancelled.

Alitalia was taken over by a group of prominent Italian business leaders, merged with domestic rival Air One and put into an alliance with Air France-KLM, which has a 25 percent stake.

The streamlined company shed more than 3,000 jobs to leave it with some 12,000 employees.

Aviationweek.com, June 5, 2009 :
Alitalia Recovering But Fears Competition

By Andy Nativi

Alitalia is slowly recovering in terms of load factors and punctuality – 80% of flights on time in May – but is facing two new potential enemies – high-velocity trains and new competition at Milan Linate city airport.

High-velocity trains linking Milan to Rome, considered the airline’s “golden route,” are attracting a wealth of business travelers, which is forcing the airline to improve the service to “premium” level and to lower fares. Also, both the Italian and European antitrust authorities are pressuring Italy to increase operations at Milan Linate by adding new slots that could be assigned to Alitalia competitors.

Domestic carrier Air Italy wants to enter the market, and Lufthansa has tried repeatedly to acquire Linate slots to operate Italian domestic routes. The list of other interested players includes British Airways, Meridiana-Eurofly, Wind Jet and easyJet. Giuseppe Catricalà, head of Italy’s antitrust authority, has proposed to boost Linate slots by 40% from 18 movements per hour to at least 25 and possibly 32.

Alitalia now has 80% of the Linate slots. The antitrust move has been criticized by Enac, the Italian Civil Aviation Authority, which has defended the low traffic volumes at Linate on the basis of environmental and noise issues, as well as safety. But many operators have said the Italian government’s decision to put heavy constraints on Linate is only intended to protect the other Milan airport, Malpensa, since everybody would prefer to operate from Malpensa, if given a choice.

Nevertheless, many international companies are willing to operate from Malpensa on long-range routes, and Italian Foreign Affairs Minister Franco Frattini said 39 countries are discussing new bilateral traffic agreements. Alitalia has instead decided to cut down operations at Malpensa, having declared Rome Fiumicino as its hub, and will concentrate, alongside Air-France-KLM and the other SkyTeam airlines, all its flights in Fiumicino Terminal A. This would happen by 2012. European antitrust authorities are also investigating the slot allocation situation at Fiumicino.

For the time being, this is a preliminary assessment, if the answer obtained will not convince European Union Competition Commissioner Neelie Kroes, a formal inquiry could start, even if the European Parliament has approved a temporary exception to the rule, which calls for the airlines to free slots that have been not actively used during the previous season. The exception has been based on general drop of passenger volumes.

http://www.aviationweek.com/aw/generic/story_channel.jsp?channel=comm&id=news/ITALIA060509.xml&headline=Alitalia%20Recovering%20But%20Fears%20Competition

Italy's Insolvency Solution
From Parmalat to Alitalia, Italian bankruptcy laws have undergone a radical change, and now they're being tested in full.
By Richard Lloyd
1 July 2009
American Lawyer
Volume 31; Issue 7

ITALIAN LAWYERS like to insist that the rescue late last year of national airline Alitalia was a one-time-only affair. Certainly, the mix of politics and a high-profile, struggling business—restructured in the full glare of the media—made Alitalia's eventual rescue unique. What wasn't unusual was that Italy was again forced to rework its bankruptcy laws to help an iconic Italian business.

At least this time less adjustment was needed. The first big reworking of Italy's insolvency laws came after massive accounting fraud was unearthed at food conglomerate Parmalat Finanziara S.p.A. in 2003. The previous insolvency regime was more than 60 years old and recognized by most as badly outdated. "Traditionally, the bankruptcy law was tailored to liquidating companies rather than restructuring them," says Fabio Guastadisegni, a bankruptcy partner with Clifford Chance in Milan.

After the Parmalat fraud came to light, the Marzano law—named after former Italian minister of industry Antonio Marzano—was adopted by the Italian government to enable large companies to keep operating after they have filed for bankruptcy. A series of amendments to the country's bankruptcy law between 2005 and 2007 also radically overhauled the restructuring process. Distressed companies and their advisers now have a series of options before and during bankruptcy that are designed to help companies avoid liquidation. Insolvency in Italy is looking more American—albeit with some important differences that have as much to do with Italy's economy as with its legal system.

In another U.S. parallel, a growing coterie of bankruptcy advisers has emerged in the Italian market. Italian firms like Chiomenti and Bonelli Erede Pappalardo have taken high-profile roles on the leading insolvencies such as Alitalia. Local rival Gianni, Origoni, Grippo & Partners strengthened its team in May by hiring Lovells's former corporate recovery head. At the international firms, Bruno Cova, the former legal adviser to the bankruptcy commissioner of Parmalat, now heads a team at Paul, Hastings, Janofsky & Walker's Milan office, while Clifford Chance and Cleary Gottlieb Steen & Hamilton also have prominent practices. As the economic crisis continues, there's a steady stream of restructuring and bankruptcy mandates to keep them busy.

In the pre-Marzano era, an insolvency procedure could last up to anywhere between ten and 15 years, says Shearman & Sterling s Michael Bosco, a partner in the firm's Rome office, and often there would be nothing left for creditors once the advisers had taken their fees. Plus, crucially, new funding to a distressed company was not protected. To those who worked under the previous insolvency laws, the new regime reflects considerable progress. "Generally speaking, the new laws work, and they're a great improvement," Paul, Hastings's Cova says.

Cova points to Parmalat's fall from grace—the food conglomerate was found with a €14 billion hole in its accounts—as the turning point in what he calls "a change in attitude to insolvencies." Instead of slipping into liquidation, the company—advised by Italian independent firm Gianni, among others—was restructured. Under the Marzano law, the government appointed a commissioner, Enrico Bondi, to draw up a restructuring plan to allow the company to keep operating. The company gained time to reach a deal with its creditors, who agreed to a debt-for-equity swap, and it emerged from bankruptcy within two years, albeit as a smaller business.

Although the Marzano law was developed specifically in light of Parmalat's collapse, it has had broad implications for the wider market, giving companies and their advisers a route to restructure a business in distress. The overall dynamic in Italy's restructuring market has shifted to one in which creditors have more power and the role of the Italian courts has been reduced. And Italian businesses now have a much more sophisticated range of options to restructure businesses and avoid bankruptcy altogether. Last year Kartogroup S.p.A., a company headquartered in Tuscany that manufactures toilet rolls and paper towels, was restructured under a process known as concordato preventivo. The process, enacted in 2006, is designed to help a company stave off bankruptcy proceedings by reaching agreement with the majority of its creditors. A company's financial position must also be assessed by an independent specialist before the application for concordato preventivo. In the case of Kartogroup, the company, which was advised by Lombardi Molinarie Associati, was ultimately sold to German company WEPA Papier fabrik in a deal announced in August 2008.

Since Parmalat, there has been a steady stream of restructurings under the new laws, Cova says. The past year has seen an acceleration in the number of new cases as the economy has worsened. Boat manufacturer Ferretti S.p.A., for example, defaulted on its debt in January. In April the company, advised by Italian firm Chiomenti, agreed to a € 1.2 billion debt restructuring with its banks, who were advised by Clifford Chance. The company's senior management, backed by a group of Italian banks, took control after former private equity owners Candover Investments and Permira Advisers pulled out.

"The restructuring [of Ferretti] succeeded, but it was not a foregone conclusion," Cova says. Although under the previous laws the company might still have been able to reach an agreement with its banks, Ferretti's restructuring was done under the amended article 67, a part of the bankruptcy regime that gives creditors greater protection from seeing their debt repayments clawed back should the company enter bankruptcy.

Despite the improvements to the restructuring and bankruptcy regimes, some lawyers say the process remains far from simple. "Recent reforms are strongly positive, but [the bankruptcy process has] moved from a position that was catastrophic to one that's difficult," Shearman's Bosco says. In Italy, the cost of the bankruptcy process accounts for 22 percent of an estate, compared with 8 percent overall in countries belonging to the Organization of Economic Cooperation and Development, according to statistics from The World Bank. Creditors in Italy recover just 56.6 percent of debt, compared with an OECD average of 68.6 percent.

Bosco points to characteristics in Italy's economy that create a different restructuring dynamic from that of the United States. "In the U.S. there's a corporate bond market, there's a wide range of shareholders, things are tightly regulated and transparent," he says. In Italy only the very largest companies have publicly traded bonds. As a result, smaller companies are more dependent on bank debt, giving Italy's financial institutions an even more important restructuring role than their U.S. counterparts. Fortunately for insolvent Italian businesses, the banks have not shown much interest in pulling the plug. "The banking system is more interested in supporting companies than seeing them brought down," asserts Giuseppe De Palma, a finance partner at Clifford Chance.

Where companies can't avoid bankruptcy, they face obstacles like the lack of an Italian equivalent of debtor-in-possession (DIP) financing. In extraordinary circumstances, insolvent companies may be able to raise money—Parmalat received just over € 100 million from a group of Italian banks soon after it filed for bankruptcy—but generally, the absence of DIP financing places a greater urgency on the bankruptcy process. Lawyers also complain that the Italian courts can be overworked and inefficient, particularly away from the main cities like Milan, Turin, and Rome. Italy lacks specialist bankruptcy courts like those in the United States.

The changes in the law—and more recently, the worsening economy—have prompted international and Italian firms to strengthen their restructuring teams. Among the most prominent practitioners are Cova at Paul, Hastings; Bonelli Erede Pappalardo, one of Italy's market leaders; and boutique Lombardi Molinari. Rivals also point to the teams at Cleary and Orrick, Herrington & Sutcliffe as having strong track records.

Other firms are starting essentially from scratch. "This is a completely new area," says Giandomenico Ciaramella, a restructuring specialist at Legance. "A few years ago, you could visit the largest Italian firms' Web sites, and you wouldn't find a restructuring area." Now, he points out, Legance has 15 lawyers in its restructuring group, drawing attorneys in from the firm's other practices such as corporate and finance. Clifford Chance only established a stand-alone restructuring group in Italy around two years ago, but it already has approximately 25 lawyers. Some firms have looked to laterals: Gianni hired Silvio Tersilla, the former Italian restructuring head at Lovells, in May. Gianni restructuring head Gabriella Covino calls Tersilla "a cross between a corporate and insolvency specialist," in a description that could apply to many of Italy's restructuring lawyers.

"Previously, you were either corporate or insolvency," she adds. "Now the restructuring process requires a more complex attitude." One that's a little more American, perhaps.

Recovery Risks; Slot changes, high-speed rail could undermine Alitalia’s efforts to rebuild
8 June 2009
Aviation Week & Space Technology

Just as Alitalia is showing signs of recovery, new threats are emerging that could jeopardize the reborn Italian airline’s future.

A high-speed rail connection could take away some of Alitalia’s lucrative Milan-Rome business, while European regulators are pushing the Italian government to allow more flights at Milan Linate Airport, potentially strengthening rival Air Italy as well as Lufthansa’s Italian operations. British Airways and others are also keen on more slots there. Alitalia currently controls 80% of Linate’s slots.

Antonio Catricala, president of the Italian antitrust authority, suggests increasing Linate slots by as much as 40%. The airport is limited to 18 movements per hour, which would be raised to 25 or even a maximum allowable 32 movements per hour, which a European Union study indicates is possible.

The lower threshold now in place came into effect in 2001 in large part to drive traffic to Milan’s more remote Malpensa Airport, which the government wanted to make the city’s primary airfield. But now, after the merger of Alitalia and Air One, there should be more competition at Linate to exploit its full potential, Catricala said after convening with European Union officials.

The Italian civil aviation authority, Enac, opposes the slot increases, citing concerns about noise and air pollution as well as safety.

Operators, though, have long complained about what they consider artificial constraints placed on Linate, which would be the preferred airport for most.

The move could also impact Malpensa, although Italy’s foreign minister, Franco Frattini, says 39 countries are discussing new bilateral traffic agreements that could bring more long-haul operations there.

Alitalia is cutting back at Malpensa, having shifted to a single-hub operation at Rome’s Fiumicino Airport. Along with minority shareholders Air France-KLM and other SkyTeam airlines, Alitalia is concentrating operations at Fiumicino’s Terminal A, and should complete the process by 2012.

Slots at Fiumicino are also under regulatory scrutiny, although Neelie Kroes, the European Commission’s competition commissioner, has not initiated a formal inquiry.

Meanwhile, Alitalia is still putting its operations in order after the merger last year with Air One, done to help Alitalia avoid insolvency. During the merger process, Alitalia shed many of its debt-laden assets.

The transition period was difficult. In January and February, load factors fell as low as 43% while the airline suffered extensive service disruptions. But operations are stabilizing, and some flights are now full. Alitalia Chief Executive Rocco Sabelli says the goal is to reach a load factor of 67% after May; the carrier considers a 64-65% load factor to be the breakeven level. Still, Sabelli says Alitalia will not get out of the red before 2011.

Pilot training is emerging as the pacing item as the new version of Alitalia overhauls its operations through the fleet reorganization.

The airline is introducing Airbus A320s and simultaneously retiring Boeing MD-80s as the centerpiece of the fleet rationalization effort aimed at reducing the number of aircraft types in service. Maintenance and support costs should come down as a result. But it will not happen quickly since it will take time to qualify pilots on the new types. So far this year, Alitalia has received five A320s originally ordered by Air One.

The medium-haul fleet is still made up of former Air One and Alitalia aircraft in their original liveries. Their mix is complicated by the fact that just as the merger was taking place, Air One was converting from Boeing 737s to A320s. Nevertheless, the majority of former Air One 737s are newer and cheaper to operate than the Alitalia MD-80s.

The merged airline’s long-range fleet plan is based on Boeing types, with 10 777-200ERs and six older 767-300ERs from Alitalia and two A330-200s still in Air One livery. Gradually, Alitalia is expected to operate more A330s. It is also buying the new Airbus twin-widebody A350.

At the end of May, Alitalia’s fleet consisted of 153 aircraft.

The regional aircraft fleet is mixed, as well, although the carrier will focus on regional jets and not use Alitalia’s legacy ATR turboprops. The RJ fleet is composed of six Embraer 170LRs (Alitalia), 10 Bombardier CRJ900s (Air One) and a single Avro RJ70 (Air One).

Ten new aircraft are planned to enter service by the end of the year as older models are phased out.

Sabelli says that by 2013, the Alitalia fleet will stand at 157 aircraft worth €4.2 billion ($5.9 billion), compared to a value of €3.3 billion this year.

Beyond the aircraft to be introduced this year, Alitalia plans to grow its fleet by eight aircraft in 2010, 25 in 2011, 24 in 2012, and five in 2013. That will give it a medium-haul fleet of 90 A320s, and 14 A330s for long-haul operations.

Alitalia reports loss but sees progress
29 July 2009
Agence France Presse

Alitalia on Wednesday posted higher than expected operating losses of 273 million euros (382 million dollars) for the first half of 2009, but said the trend showed sharp improvement.

The Italian airline, taken over by domestic business leaders, merged with domestic rival Air One and put into an alliance with Air France-KLM, which has a 25 percent stake, said the losses were 6.0 percent over budget.

The streamlined company, which came into being on January 13, nevertheless said losses had fallen markedly from the incomplete first quarter to the second -- from 210 million euros to 63 million.

After shedding more than 3,000 jobs to leave it with some 12,000 employees, bosses said turnover to the end of June was 1.28 billion euros.

Alitalia flew 10 million passengers during that period in what amounted to 59 percent seat occupancy, which it said was "broadly in line with expectations."

Alitalia auctions off paintings to pay creditors
10 December 2009

ROME (AP) - Nearly 200 paintings and drawings by contemporary Italian artists have been auctioned off to help pay creditors of troubled Alitalia airline.

The Finarte auction house said Thursday the sale fetched euro1.2 million ($1.77 million).

The paintings were among the troubled Alitalia assets taken over by a bankruptcy administrator, who has been selling them off to pay some of the old Alitalia's creditors. The new Alitalia was formed last January by a group of Italian investors who merged it with the smaller Air One.

Georgia Bava of Finarte said the pieces were originally displayed on aircraft "to let the world know about Italian art." Most recently they were in storage.

An abstract painting by Lucio Fontana fetched the highest price, euro48,000.

777 in new AZ c/s at FCO

http://img260.imageshack.us/img260/2183/hgrtyj576k.png (http://img260.imageshack.us/i/hgrtyj576k.png/)

http://img7.imageshack.us/img7/1739/fgjtyjkruk.png (http://img7.imageshack.us/i/fgjtyjkruk.png/)

http://www.airliners.net/aviation-forums/general_aviation/read.main/4629364/

New Alitalia celebrates 1st birthday; 21 million passengers in 2009 across 73 destinations

This week saw the first anniversary of the launch last January of the ‘new Alitalia’, the airline created by private investors out of bits of the old Alitalia, Air One and Volareweb. According to statistics provided by AEA, between 13 January 2009 and the end of November the new airline carried just over 19.6 million passengers at an average load factor of 65.4%. The load factor figure compares poorly with major legacy carrier rivals such as Air France (78.8%), British Airways (78.2%), Iberia (79.9%), KLM (81.4%), Lufthansa (77.9%) and even SAS (71.7%).

http://www.anna.aero/wp-content/uploads/2010/01/cht-az-2009.jpg

For 2009 as a whole it looks likely that the airline will have carried around 21 million passengers using a fleet of almost 150 aircraft across a network comprising of some 73 airports. The fleet currently consists of two A330s, 10 777s and six 767s for long-haul flights, over 80 A320 series aircraft, a dozen 737s (from Air One), and almost 20 MD-82s which are being rapidly phased out. In addition there is a ‘regional’ fleet comprising 10 CRJ-900s (from Air One CityLiner) and six Embraer E170s (from Alitalia Express). In future, the airline plans to operate additional A320s (to replace the MD-82s), A330s (replacing the 767s) and even A350s (though these are not expected to enter service before 2014).

Four destinations dropped and four added during 2009
According to OAG data, since re-launching last January Alitalia has axed services to four European destinations while adding services to four others. The axed airports were Dűsseldorf (from 30 June), Krakow, Prague (from 28 March) and Timisoara while the new additions to the network were Berlin (Tegel), Crotone, Thessaloniki and Valencia. The airline’s global network as operated this month remains at 73 destinations (of which 51 are in Europe) although new routes from Rome starting this summer will see the addition of Los Angeles, Malaga and Vienna to the network. Other possible new destinations from Rome this summer include Berlin Tegel, a return to Prague, Seoul Incheon, Shanghai Pu Dong, Rio de Janeiro and Zurich.

That still leaves quite a few major European cities not currently served including Copenhagen, Dublin, Dűsseldorf, Helsinki, Lisbon, Lyon, Manchester, Glasgow, Oslo and Stockholm. A number of other destinations served by the ‘old’ Alitalia are summarised in our previous analysis of the ‘new Alitalia’. Outside of Europe the airline currently serves 22 destinations.

Several new routes from Bologna, Catania and Linate
A year-on-year comparison reveals that Alitalia has cut frequencies at six of its busiest 12 airports while increasing flights at five others (Bari remains unchanged). Double-digit percentage increases have occurred at Bologna, Catania and Milan Linate.

http://www.anna.aero/wp-content/uploads/2010/01/cht-az-top-airports.jpg

At Bologna the airline has added new daily flights to Catania and Palermo (both in Sicily), while Catania has seen the addition of new services to Genoa and Venice as well as Bologna. From Linate Alitalia has added flights to Bucharest Otopeni, Crotone and Paris Orly, though Athens and Warsaw services were axed last September.

The biggest cutbacks have continued to be felt at Milan Malpensa where weekly flights have been halved from 260 to 130 per week, making the airport just the seventh busiest in the airline’s revamped network.

Few international routes outside of Rome and Milan
Rome Fiumicino is the airline’s dominant international hub but it does offer a range of international services from both Milan airports. This winter saw the launch of all four of the international routes currently available from Turin.

Milan Linate to Amsterdam, Barcelona, Bucharest Otopeni, Brussels, Frankfurt, London City, London Heathrow, Madrid, Paris CDG, Paris Orly.
Milan Malpensa to Algiers, Cairo, Istanbul, Kiev, Moscow Sheremetyevo, New York JFK, Sao Paulo, Sofia, Tel Aviv, Tirana, Tokyo Narita, Tripoli, Tunis
Naples to Athens
Turin to Amsterdam, Berlin Tegel, Istanbul, Moscow Sheremetyevo.

:cheers:

Happy Birthday Alitalia :)

The celebration of a grand scam against Italian citizens and all of its passengers. First its "managers" arrange for it to go bankrupt by squandering millions of euros (in spite of paying ground and travelling personnel Europe's lowest salaries) then, abracadabra! They create a "good" company to revive Alitalia (by selling good assets to private entrepreneurs in "good terms" with the gov't) and a "bad" company (i.e. leaving liabilities to the Italian state, the one that will have to fill the abyss of debt). There is just nothing to celebrate. Or, we could as well celebrate Al Capone's anniversary.

I didn't even knew about "new Alitalia"...

Alitalia CEO: 2Q Strong, No Need For Fresh Capital
5 July 2010

ROME (Dow Jones)--Unlisted carrier CAI Alitalia SpA improved its performance in the first half due to a "very strong" second quarter, Chief Executive Rocco Sabelli said Monday.

"The Italian carrier posted double-digit [percentage] improvements in several key sectors, including transatlantic flights and capacity levels," Sabelli said. "The company had EUR500 million in cash and credit lines as of June 30, and is on course to achieve its industrial plan targets, which doesn't foresee any fresh capital injections," Sabelli added, while agreeing uncertainty remained high.

On Monday CAI Alitalia also announced a joint venture with Air France-KLM (AF.FR) and Delta Air Lines Inc. (DAL). Sabelli said that the joint venture is "fundamental for the definitive revival" of the Italian carrier.

Sabelli said there were "no plans" to merge CAI Alitalia with Air France, which already owns 25% of the carrier. "The joint venture is a way of ramping up operational scale while keeping corporate balance sheets of member companies sustainable," Sabelli said, adding that he hoped more airlines, including smaller ones, would join the venture.

AirFrance-KLM Chairman Pierre-Henri Gourgeon, who was in Rome to sign the joint venture expansion, said the arrangement was "as close as you can get" while remaining separate companies. He also said his company's decision to write down the value of its stake in CAI Alitalia was a result of accounting rules and not as an expression of Air France's valuation of CAI Alitalia.

Alitalia sees recovery continuing in H2

TOKYO, Sept 15 (Reuters) - Italian carrier Alitalia expects passenger traffic to continue recovering in the second half of the year after a 10 percent rise in first-half revenue, thanks to growing travel demand especially in and out of Brazil and Argentina, a senior executive said.

Alitalia, in which Air France-KLM holds a 25 percent stake, may also increase its flight frequency to Osaka, the business hub of western Japan, eyeing greater access in the country as once-high-flying Japan Airlines slashes routes as part of its massive restructuring.

"When there's a market opportunity, go after it. You can't wait, you have to react very fast because the market changes very quickly," Giorgio Callegari, executive vice president for alliances and strategies at Alitalia, told Reuters in an interview.

"When JAL announced reduction of their services we decided we would revisit our network strategy and readjust our long-houl network to see if we could come up with more capacity to dedicate to Japan. We have been successful in doing that," he said.

JAL, after filing for bankruptcy in January with $25 billion in debt, is set to terminate both its Milan and Rome services by early next month. The Japanese carrier also plans to abandon one in eight overseas flights and end a quarter of its home routes in a bid to return to profit. [ID:nTOE67U06X]

Tapping into a market opportunity created by JAL's withdrawal, the loss-making Italian carrier is set to increase its service to Tokyo's Narita airport to 14 flights a week by early next month, up 40 percent from six months ago.

Alitalia went bankrupt in 2008 after years of struggling with strikes and inefficiencies and was relaunched as a private airline by Italian investors last year. It had a difficult rebirth, grappling with low occupancy rates and flight delays that prompted a barrage of complaints.

But the airline's performance in the first half of the year showed a strong improvement from a year earlier, with revenues rising 10 percent. [ID:nLDE6641AL]

Callegari, speaking at Alitalia's Tokyo office, said the company is on track to break even in 2011 as planned under its restructuring.

"In July, August and part of September what we've seen are (passenger) volumes that are slightly better than the first six months (of the year) and we're also seeing a good booking trend for the remaining part of the year," he said.

"Our overall forecast for market growth in Italy for 2011 is about 7 to 8 percent. The fact that we grow more than the market is an indication of good performance," said Callegari.

Alitalia sees recovery continuing in H2

TOKYO, Sept 15 (Reuters) - Italian carrier Alitalia expects passenger traffic to continue recovering in the second half of the year after a 10 percent rise in first-half revenue, thanks to growing travel demand especially in and out of Brazil and Argentina, a senior executive said.



Good news! :)

Almost official AZ new fligth: Rome-Rio/June 11

I hope AZ resume São Paulo-Milan,ended at April/2010.

Good to see Alitalia improving! :)

It's a great classic airline, that should be kept.

It should increase its long-haul destiantions. Rome has few trancontinental destinations and many non-European airlines only fly there seasonally. Alitalia has to catch the huge tourist flow from emerging markets.

Alitalia: direct flights between Italy and Japan and increase of frequencies from Rome and Milan to Tokyo

http://img814.imageshack.us/img814/416/bigphotohome1.jpg
Rome, Italy - All routes will be served by a B-777 airplane with 291 seats

Alitalia will be the only carrier, from next October 1st, to offer direct links between Italy and Japan, increasing the connections from Rome and from Milan to Tokyo, bringing the offer to 18 weekly frequencies between two Countries.

The frequencies per week to rise from 3 to 4, as of next October 7, from Milan, with a flight that will take off at 12:25pm from Malpensa and will arrive at 5:55pm (local hour) of the following day. From 9 to 10 will be those ones from Rome, starting from November 2, with a new service at 9:20am and arrival at 2:05pm (local hour) of the following day. Alitalia to continue to operate also the links from Rome to Osaka, with four frequencies per week.

The increase of the flights between Italy and Japan meets the strong request of the touristic traffic and business one. The passengers who arrive in Rome or in Milan by Alitalia could continue towards all other destinations in Italy and Europe served by carrier's network.

All routes will be operated, from next October 1st, by Boeing 777 airplane with 291 seats on board.

Alitalia continues to reinforce its own network, to renew its fleet and to invest about services' quality. In August the flights regularity has been about 99,9% and the punctuality 80%. The passengers have increased 12% and the revenue 17% (compared to the same month in 2009). The customer satisfaction has risen at 80%, +10% compared to the last year.

http://www.avionews.com/index.php?corpo=see_news_home.php&news_id=1120766&pagina_chiamante=index.php

good news for my country's national carrier :cheers:

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http://img715.imageshack.us/img715/3629/1601653.jpg (http://img715.imageshack.us/i/1601653.jpg/)

Alitalia resumes Rome – Rio de Janeiro from June 2011
20100924 by jimyvr Leave a Comment

Alitalia from 04JUN11 resumes Rome – Rio de Janeiro service. Service operates with brand new Airbus A330-200 aircraft, initially with 3 weekly, then increasing to 4 weekly from 28JUN11.

Schedule below:

AZ672 FCO2230 – 0540+1GIG 330 x134
AZ673 GIG1445 – 0710+1FCO 330 x245

04JUN11 – 26JUN11 FCO departure Day 267, GIG departure Day 137

http://airlineroute.net/2010/09/24/az-fcogig-s11/

Great to see Alitalia expanding! :cheers2:

Jet Airways, Alitalia in code sharing pact

MUMBAI, Oct 21 (Reuters) - Indian carrier Jet Airways has inked a code sharing pact with Italian carrier Alitalia to operate codeshare flights during the winter season.

Jet Airways customers globally will be able to fly to new Italian destinations, served by Alitalia. Alitalia customers will be able to fly directly from Italy to India with new destinations, Jet said in a statement late on Wednesday.

Jet Airways will operate daily direct services between Milan and New Delhi starting Dec 5.

Just booked with them to take me to Italy for the second time this year. I flew with them already, and It was a good experience.

Alitalia chief plays down Air France-KLM merger talk

RHO, Italy, Nov 2 (Reuters) - The idea of a merger between Alitalia and Air France-KLM is not one that is backed by shareholders, Alitalia's chairman said on Tuesday, playing down an option raised by the Italian carrier's CEO.

Air France-KLM has a 25 percent stake in Alitalia, which was bought by a group of Italian investors after it went bankrupt under the weight of a heavy debtload, persistent strikes and high costs. The French carrier has long been considered likely to seek full control of the Italian airline over the long term.

Earlier on Tuesday, extracts from a book by an Italian journalist quoted Alitalia CEO Rocco Sabelli saying he planned to recommend to shareholders a merger between the two airlines.

But Alitalia chairman Roberto Colannino dismissed the idea.

"It may be a thought of Sabelli's, but it's not shared by shareholders," Colaninno told reporters.

Alitalia Chairman: Not Ruling Out Possible Merger With Air France
11 November 2010

SINGAPORE (Dow Jones)--CAI Alitalia SpA Chairman Roberto Colannino said Thursday that he isn't ruling out a possible merger of the Italian airline with Air France-KLM (AF.FR), a prospect raised by Alitalia's chief executive in comments published last week.

"In business, you can exclude nothing. It's the market that suggests to us what we have to do," Colannino told Dow Jones Newswires.

"Alitalia's No. 1 priority is to make profits. After that, we wait and see," he said.

According to extracts from a book published last week, Alitalia Chief Executive Rocco Sabelli plans to recommend to shareholders a merger with the French carrier in 2013, when Alitalia shareholders are free to sell their stakes.

Colannino, responding to Sabelli's comments, said last week that the idea of a merger "is definitely not shared by shareholders."

Air France-KLM owns 25% of Alitalia, which is unlisted.

Colannino, who is also the chairman and chief executive of Italian scooter maker Piaggio & C SpA (PIA.MI), said Alitalia's shareholders are committed to hold their stakes until 2013.

"Based only on this fact, I naturally won't be able to predict what will happen two years from now," he said, adding it was "not appropriate" to comment on what the airline might do in the future.

Italian Prime Minister Silvio Berlusconi, who engineered Alitalia's rescue from bankruptcy in late 2008 by a group of private investors led by Colannino, said last week that the airline needed to remain Italian.

Alitalia is expected to break even at the operating level next year, and will probably turn a profit in 2012, Colannino said.

"The market is going very well, giving good results," he said, adding that the airline plans to open new routes to Beijing and Shanghai next year.

Last month, Alitalia announced a third quarter net profit of EUR39 million, up from EUR1 million a year earlier.

AZ@YYZ



http://img837.imageshack.us/img837/6222/aasas5.jpg



http://img176.imageshack.us/img176/3154/ddfdfd.jpg

Alitalia Chairman: Doesn't Exclude Anything, Not Even Air France Merger
24 November 2010

MILAN (MF-Dow Jones)--Alitalia SpA Chairman Roberto Colaninno Wednesday reiterated he did not exclude anything, not even a potential merger with Air France-KLM (AF.FR), a shareholder in the Italian airline.

Colaninno was speaking to reporters on the margins of an event at which Jet Airways (532617.BY) announced the opening of a route to New Delhi from Milan.

Alitalia Chief Executive Rocco Sabelli has said he planned to recommend to shareholders a merger with the French carrier in 2013, when Alitalia shareholders are free to sell their stakes.

Colaninno led a group of private shareholders in the takeover of Alitalia in 2008 with the help of the government.

Air France-KLM Chief executive Pierre-Henri Gourgeon said recently only that the cooperation between the two airlines has been going very well since Air France-KLM took a 25% stake In Alitalia in 2008.

Alitalia Picks Embraer Over Sukhoi To Lease Planes
18 December 2010

ROME (Dow Jones)--Alitalia Friday said it would lease 20 regional planes from Brazil's Embraer rather than Russia's Sukhoi because its preferred candidate had gotten mired in delivery problems.

Alitalia Chief Executive Rocco Sabelli said the airline had initially favored Sukhoi but delays in the development of its new Sukhoi Superjet 100 made it decide to choose Embraer instead.

"The problem is that the Superjet is still not in the air," he told reporters on the margins of an event with the airline's unions, according to MF-Dow Jones. "A flight is foreseen in Russia for January but there are even uncertainties about that date."

Alitalia will lease five E190 planes and 15 E175 planes from Embraer, he said.

"Five or six will arrive in August 2011 and the rest by mid-2012."

"We are particularly surprised by Alitalia's choice given its recent positive feedback on Superjet," a source close to Alenia Aeronautica, a partner of Sukhoi Design Bureau Co. in the SuperJet International joint venture, told Dow Jones Newswires.

"We are ready to start delivering the planes to Alitalia in summer," the source said.

Alitalia will also receive next year the new Airbus planes it had previously ordered, he added. "By 2012, the fleet will be completely new," Alitalia's Sabelli said.

Alitalia has a fleet of 147 planes.

Sabelli also said he expects Alitalia to at least halve its operating loss this year. In 2009, the loss stood at EUR274 million.

Alitalia aimed to increase capacity by 6-7% next year, most of which on international and intercontinental flights, he said.

Revenue could rise by 13-14%, he added.

The Superjet, which is still undergoing tests, is the first new passenger plane to be made in Russia since the Soviet Union's collapse in 1991.

Its developer, Superjet International, is jointly controlled by Russia's state-run Sukhoi Design Bureau and Alenia Aeronautica, a unit of Italian defense and aerospace group Finmeccanica SpA.

It submitted a bid to Alitalia in October, putting itself in competition with Embraer and Canada's Bombardier Inc.

Finmeccanica declined comment, while Embraer was not immediately available for comment.

Montreal-based Bombardier continues to be in talks with Alitalia, a company spokeswoman says.

"We are committed to offering Alitalia a fleet renewal solution that offers the best value proposition for regional jet efficiency with our CRJ900 and CRJ1000 aircraft," says Bombardier's Marianella delaBarrera.

Alitalia is 25% owned by Air France-KLM (AF.FR). The remainder is held by a private group of investors called Compagnia Aerea Italiana SpA.

By VRHNA from HKADB :

http://img.photobucket.com/albums/v467/vrhna/DSC_8165.jpg

Alitalia Boosts Number Of Seats Flying Out Of Egypt
31 January 2011

ROME (Dow Jones)--Alitalia said Monday it has increased its capacity to fly Italian nationals out of Egypt by operating its three daily flights from Cairo with 200-seater Airbus A321 jets rather than smaller A320 planes.

No flights have been canceled, although some have been delayed a bit to allow passengers to reach the airport, said the Rome-based company, in which Air France-KLM SA (AF.FR) is a significant shareholder.

The ANSA news agency reported that Italy's Foreign Ministry has advised citizens against taking holidays in Egypt, calling it "imprudent" to embark on such tours now. An estimated 15,000 Italians are currently in Egypt, according to the ministry.

Any chance Alitalia will return to Asmara from Rome?? ID love it to start flying again.

Brazil's Embraer Sells 20 Regional Jets To Alitalia
21 March 2011

SAO PAULO (Dow Jones)--Brazilian aircraft manufacturer Embraer S.A. (ERJ, EMBR4.BR) Monday announced the sale of 20 regional jets to Italian flagship carrier Alitalia.

The package includes 15 ERJ-175 models and five ERJ-190 models. The ERJ-175s will be configured for 88 passengers, while the ERJ-190s will take 100 passengers.

Embraer did not reveal financial terms of the deal. Based on previous sales, the package would be worth about $620 million.

Embraer said the first of the planes will be delivered to Alitalia in the third quarter of this year.

Embraer said Alitalia will use the jets as part of a program to update its fleet and widen its network of regional flights.

Source : http://pic.feeyo.com/posts/528/5286306.html

http://pic.feeyo.com/pic/20110407/201104070511483739.jpg

Alitalia starts flights to Beijing and Rio

Italian national carrier Alitalia has launched services from Rome to the capital of China and Brazil’s second largest city. Alitalia can claim a first with the introduction of direct flights between Rome and Rio de Janeiro, a route not currently served by any other airline.

In June, the airline will operate Rome-Rio flights three times a week, before adding a fourth service in July. The new Rome Fiumicino-Beijing flight operates four times a week, with an additional flight to be added in October taking it to five times per week.

Alitalia already codeshares with China Eastern on flights between Rome and Shanghai.

Giancarlo Schisano, Alitalia’s director of operations, said China and Brazil represent “target markets” for expansion. Alitalia’s international growth strategy “focuses on areas of the world with the highest growth rate for leisure and business traffic,” he added.

The new flights are operated using new A330 Airbus aircraft, with a 3-class cabin configuration: Magnifica (business), Classica Plus (premium eceonomy) and Classica (economy). Alitalia has taken delivery of four new Airbus A330s in the past year.

http://www.abtn.co.uk/news/0815898-alitalia-starts-flights-beijing-and-rio

"Deca Degli Abruzzi" (Skyteam) at Miami MIA/KMIA

http://i1239.photobucket.com/albums/ff503/NachoJFX/IMG_1003copia.jpg

^^ it's "Duca" degli Abruzzi ;)

BTW here it's the brand new AZ A319:

http://xfw-spotter.blogspot.com/search/label/Alitalia

:cheers:

Source : http://pic.feeyo.com/posts/350/3500533.html

http://pic.feeyo.com/pic/20080710/200807100320241515.jpg

http://pic.feeyo.com/pic/20080710/200807100335316731.jpg

Source : http://pic.feeyo.com/posts/350/3500533.html

http://pic.feeyo.com/pic/20080710/200807100320241515.jpg

http://pic.feeyo.com/pic/20080710/200807100335316731.jpg

hkskyline, thanks a lot to u and all the forumers for the precious job you did, finding pictures and news about Alitalia. I promise i'll try to help at my best to let you know the latest news about the italian flagship carrier that is working hard to improve service to passengers, and network.
^__^

domestic pier at FCO needs a maquillage :ohno:

---

New A319 for AZ

http://img683.imageshack.us/img683/436/eiimm.jpg

http://xfw-spotter.blogspot.com/2011/06/a319-111-alitalia-d-avye-ei-imm-msn.html

Alitalia in the NYC Subway:
http://img838.imageshack.us/img838/9950/az1a.jpg

Alitalia's landside Shuttle service in FCO:

isTlKf_m5sE&rel=0

"Euro Annies 2011": Alitalia is the European flag carrier which during 2010 and 2011 has opened the largest number of new routes. Air One grows in Milan Malpensa and opens in Pisa.

https://lh5.googleusercontent.com/-jVMqNeGCh0M/TjSpbU5nZ5I/AAAAAAAAAb4/OopiNzHpn_o/1312074090063.png

Rome, 25 May 2011 - Alitalia has received the " Euro Annies 2011" award as the European flag airline that launched the largest number of new routes during 2010 and 2011. The award was conferred by anna.aero Airline Network News and Analysis (www.anna.aero), the portal specialising in the analysis of airlines' networks. By August 2011 Alitalia will have opened 26 new routes, including 4 intercontinental, 7 international and 15 national. Among the top new Alitalia destinations: Miami (from Milan Malpensa), Los Angeles, Beijing, Rio de Janeiro, Amman, Vienna, Toulouse, Malaga, Amsterdam (from Florence). Furthermore, during the period taken into consideration by anna.aero, in addition to the 26 new routes opened by Alitalia, Air One launched 14 new routes from Milan Malpensa airport, of which 7 in 2010 and 7 in the current summer season. To date, Air One operates a total of 21 destinations from Milan Malpensa. In addition to Milan Malpensa, from 1 July 2011, AirOne will also have a new operational base in Pisa with eight new routes, for an overall total of 22 new routes served. "Internationalisation and attention to the territories are essential elements of the Alitalia's network development strategy" says Andrea Stolfa, EVP Marketing, Revenue Management & Network. "With a wide offer of domestic destinations and the development of international and intercontinental routes, Alitalia continues, together with Air One, to be the company serving the needs of mobility of the country. We see with satisfaction that our dynamism has been recognised and rewarded. "

http://www.ftnnews.com/aviation/12698-alitalia-received-the-qeuro-annies-2011-award.html

Alitalia narrows half-year loss to €94 million

Alitalia Group reported a net loss of €94 million ($134.9 million) in the 2011 first half, a 43% improvement from the €164 million deficit incurred in the year-ago period. It incurred a €5 million net loss in the second quarter. Half-year operating loss was €69 million compared to a €129 million operating loss in the year-ago period, yet EBIT was positive in the second quarter at €17 million.
Half-year revenue rose 7% year-over-year to €1.56 billion and passengers carried increased 5.7% to 11.2 million, including 8.8% growth in the second quarter. Load factor was level at 68%.
AZ said the financial improvement was "even more significant" considering a 10% revenue decrease in two key markets, Japan and North Africa, and the sharp increase in costs associated with the spike in fuel prices, its fleet upgrade project and the end of labor cost benefits.
As of June 30, AZ's operating fleet comprised 150 aircraft, of which 27 (four Airbus A330s, 22 A320s and one A319) have been delivered since 2009. The average fleet age now stands at 8.9 years. AZ's fleet renewal will continue in the 2011 second half with delivery of 10 new aircraft (one A330, four A319s and five Embraer E-jets) (ATW Daily News, Jan. 21 (http://atwonline.com/airline-finance-data/news/alitalia-renewing-customer-service-image-fleet-2011-0120)). In addition, the carrier has begun renewing the cabins of its 10 Boeing 777s.
Third-quarter outlook shows an "important acceleration of passenger and revenue growth" over the year-ago period, it said, adding that growth will be "particularly driven" by the intercontinental segment.


http://atwonline.com/airline-finance-data/news/alitalia-narrows-half-year-loss-94-million-0802

Old Alitalia commercials:

-gBHSvJOzBEbMWzNdz2BVE
qlbRln36D8YTgJvg7bVu6s

Nice! Forza Lazio! Frima squadra di capitalle!

OMG :lol:

OMG :lol:

It was them that hooked me up on Alitalia. Btw who is eligible for that shuttle service?

:dunno:

Alitalia Planned Embraer E175/E190 Operational Routes

As per 04AUG11 GDS timetable display, Alitalia’s New Embraer E175 and Embraer 190 aircraft to its operation from the launch of Winter 2011/12 schedule.
Some of these routes has been mentioned previously. Additional changes to these specified routes, effective dates, remains possible:

Embraer E175
Milan Linate – Trieste eff 02NOV11, 1 of 2 Daily (CT)
Trieste – Genoa eff 02NOV11, All 4 weekly (CT)
Rome – Trieste eff 30NOV11, 1 of 5 Daily (CT)
Rome – Munich eff 01DEC11, 1 of 2 Daily (CT)
Rome – Vienna eff 01DEC11, 1 of 2 Daily (CT)
Rome – Ancona eff 01MAR12, All 3 Daily (CT)
Embraer E190
Milan Linate – Brussels eff 30OCT11, 1 of 2 Daily (XM)
Milan Linate – Barcelona eff 31OCT11, 1 of 3 Daily (VE)
Milan Linate – Madrid eff 01NOV11, 1 of 3 Daily (XM)
Milan Linate – Frankfurt eff 01JAN12, All 2 Daily (CT)
Milan Linate – Rome eff 02JAN12, 4 Daily (CT)
Routes marked with following represents flight crews provided by:
XM – C.A.I. First (Formerly known as Alitalia Express)
VE – C.A.I. Second
CT – AirOne CityLiner

Font: Airlineroute

Alitalia Latest Beijing schedule change in W11 as of 04AUG11

AS per 04AUG11 GDS timetable display, Alitalia has reversed planned schedule change on Rome – Beijing service for Winter 2011/12 season.
It appears that the Skyteam carrier is able to secure mid-day slot at Beijing airport, instead of early-morning hours between 0400-0600hrs.
Latest schedule effective 30OCT11 as follows:

AZ790 FCO1800 – 1120+1PEK 330 x26
AZ791 PEK1350 – 1825FCO 330 x37

Font: Airlineroute

Edit

as soon as possible, pics of new Alitalia E190s :cheers:

^^

http://img854.imageshack.us/img854/9205/galeria213127581694e3f1.jpg

http://www.aeroworldnews.com.br/ftgaleria/galeria_213127581694e3f199994f25.jpg

Higher res.pic:

http://www.flickr.com/photos/marzapagency/6014744857/sizes/l/in/photostream/

:cheers:

New A319 for AZ:

http://img14.imageshack.us/img14/3716/307051312992705.jpg

http://www.jetphotos.net/viewphoto.php?id=7182043&nseq=7

AZ B777 taking off in FCO

http://img220.imageshack.us/img220/8108/summer2011002.jpg

PIc BY ME :cheers:

How could be an AZ B777 retro livery:

http://img546.imageshack.us/img546/1876/00014418.jpg

thanks to RP Abraham for Aviation-design.net

http://www.cardatabase.net/modifiedairlinerphotos/search/photo_search.php?id=00014418

EI-EJK, the last AZ A332:

http://www.flickr.com/photos/kenfielding/6101171562/sizes/l/in/photostream/

:cheers:

^^ Thanks for the pics, you're an Angel !

http://www.kagnewstation.com/scrapbook/simmons/airport/album/slides/Asmara%20Airport%20Alitalia.jpg


A historic picture, Alitalia DC-8 in Asmara

EI-EJK, the last AZ A332:

http://www.flickr.com/photos/kenfielding/6101171562/sizes/l/in/photostream/

:cheers:

Great pics, thank you Shezan!

Thanks for the pics, you're an Angel !

Great pics, thank you Shezan!

thank you guys :cheers1:

PS [aggiornate anche voi questa sezione, e distaccatevi da quella italiana che grazie a quel pallone gonfiato di moderatoruccio è diventata una fogna invivibile]

new AZ A330 seat map

http://corporate.alitalia.it/it/Images/seatmap_A330_536px_tcm6-39460.jpg

one more brand new AZ A319

http://img545.imageshack.us/img545/8128/myaviationnetphotoid020.jpg

http://www.myaviation.net/search/photo_search.php?id=02038003&size=large

thanks to the italian CGIL Union:

Alitalia comments today's strike in Italy: measures aimed at reducing impact on travellers

Rome, Italy - The protest could involve high-level employees of the sector


In view of the national general strike, proclaimed by the CGIL for today, Tuesday, September 6 from 10:00am to 6:00pm, Alitalia has set up preventive measures to reduce the impact on passengers.

The strike will involve various categories in the industry, such as air traffic control officers and airport service workers, particularly in airports such as Milan and the centre-north. The carrier has reduced the number of flights scheduled for the time zone affected, in coordination with major airport operators.

The changes will not affect international flights, which provide regular.
Alitalia is contacting all passengers affected by flight operational changes to provide them with the relocation of alternative flights in the same time slot or day.

Information desks will be available at the airports of Rome-Fiumicino and Milan-Linate Airport to provide additional support in case of requests for assistance from passengers.

All passengers holding a confirmed reservation and a ticket issued on canceled flights because of strike are entitled to a refund or re-booking without penalty or itinerary to fly before the effective date of the ticket or, maximum within three months after the original date of first flight.

The company invites its passengers whose flights schedule falls between 10.00am and 6.00pm to check the status of their flights on the website Alitalia.com under "Flight Status". For more information and assistance passengers can contact the carrier on the toll free number 800-650055 06-65640. Avionews

http://www.avionews.com/index.php?corpo=see_news_home.php&news_id=1133481&pagina_chiamante=index.php

:bash:

situation of AZ WBs of next years

http://img231.imageshack.us/img231/1890/67t9g5.jpg

http://www.aviazionecivile.com/vb/showthread.php?116056-News-flotta-Alitalia-CAI-Parte-3&p=1236001&viewfull=1#post1236001

2 more 777? i did't know that.
those planes will be some brand new ones from Boeing, two old ones purchased from other airlines or a leasing?

some leasing carriers have 77W, and AZ may use them on routes such FCO/MXP-NRT, MXP/FCO-EZE

IMHO

some leasing carriers have 77W, and AZ may use them on routes such FCO/MXP-NRT, MXP/FCO-EZE

IMHO

i hope so

Is Johannesburg (JNB) still high on the list of possible service from either MXP or FCO in the next few years?

Is Johannesburg (JNB) still high on the list of possible service from either MXP or FCO in the next few years?

FCO-JNB will be one of the nex IC routes of Alitalia, late 2011 or 2012 at least

:cheers:

---

IMHO

Carpatair announces the code share partnership with Alitalia

Carpatair, the European regional airline with its main hub at Timisoara, Romania, announces the implementation of a code-share agreement with Alitalia starting this winter season. According to the agreement, Carpatair flights to and from Italy to Timisoara and other Romanian destinations, as well as the connecting flights from Timisoara to Moldova and Ukraine will be marketed by the Italian flag carrier under its own flight numbers.
The partnership grants Alitalia customers access to more solutions for travelling to and from Eastern Europe through the extensive route network of Carpatair, which connects multiple destinations in Romania, Ukraine and Moldova via Timisoara. In turn, the Carpatair customers will have more travel options to over 90 destinations on 5 continents covered by the Alitalia global network.
“We are pleased with the partnership with Alitalia, one of the leaders of global air transport industry. We believe that both the Alitalia and Carpatair passengers will fully appreciate the variety of new travel options, prices and very convenient schedules”, said Nicolae Petrov, President& CEO of Carpatair. Concluding “the special prorate agreement” will follow soon, whose implementation will provide customers with a diverse schedule of routes and very affordable prices covering the entire flight network of Carpatair and Alitalia”, said Nicolae Petrov.


http://www.aviator.aero/newswire/index.php/2011/09/carpatair-announces-the-code-share-partnership-with-alitalia/

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IMHO

Grande Shezan! Welcome back :cheers:

Nice! Forza Lazio! Frima squadra di capitalle!

:bow::bow:

AP A330 engine #1 failure upon airborne in BOS

http://img5.imageshack.us/img5/9436/1979623.jpg

http://www.airliners.net/photo/Air-One/Airbus-A330-202/1979623/L/&sid=f5a0ef37f81d1cbc40d7e42406660a7e

FCO-JNB will be one of the nex IC routes of Alitalia, late 2011 or 2012 at least

:cheers:

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IMHO

What about Asmara?

Probably next african destinations by AZ will be Johannesburg and Dakar. AZ has actually a c/s with KA

:cheers:

Probably next african destinations by AZ will be Johannesburg and Dakar. AZ has actually a c/s with KA

:cheers:

Kenyan doesnt fly there And im surprised they havent started flying to Asmara. They could take some passengers away from Lufthansa(Only major carrier that flies there) if they played their cards right. But Eritrean Airlines started flying to Rome 2X weekly and will start Milan soon :D

Kenyan doesnt fly there And im surprised they havent started flying to Asmara. They could take some passengers away from Lufthansa(Only major carrier that flies there) if they played their cards right. But Eritrean Airlines started flying to Rome 2X weekly and will start Milan soon :D

Font? I'll hope :cheers:

Font? I'll hope :cheers:

:rofl:

Alitalia Customer Reviews and Passenger Trip Reports

http://www.airlinequality.com/Forum/alit.htm

:cheers:

http://cdn-www.airliners.net/aviation-photos/photos/0/4/0/1987040.jpg

http://www.airliners.net/photo/Alitalia/Embraer-ERJ-190-100STD-190STD/1987040/L/

Brand new Embraer 190.

Alcune foto degli interni dei nuovi Embraer-190, la qualità è quella che è (sono tratte da un video del TG1). Per essere un regional la cabina sembra molto spaziosa e non claustrofobica come i CRJ.

http://i4.photobucket.com/albums/y128/landingFCO/EMB1901.png

http://i4.photobucket.com/albums/y128/landingFCO/EMB1902.png

http://i4.photobucket.com/albums/y128/landingFCO/EMB1903.png

@ Kyiv Boryspil International Airport

http://spotters.net.ua/files/images/0000054544_large.jpeg

http://spotters.net.ua/file/?id=54544&size=large


http://spotters.net.ua/files/images/0000054514_large.jpeg

http://spotters.net.ua/file/?id=54514&size=large


http://spotters.net.ua/files/images/0000054529_large.jpeg

http://spotters.net.ua/file/?id=54529&size=large

Alitalia to start service to Tbilisi


After long and efficient negotiations with Alitalia, TAV Georgia managed to convince Italy’s largest air carrier to start regular flights from Rome to Tbilisi in forthcoming summer season.
Italy’s largest and world’s 19th largest company is expected to operate at least 2 flights per week. Ticket prices are not certain yet, but shall be finalized within a few months.
With the fleet of 150 airplanes, Alitalia performs flights to 28 local and 62 international destinations in 41 countries worldwide and soon Georgia will be added to this list.

Speaking of the significance of the flight, TAV Georgia’s General Manager Mr. Mete Erkal said: “The direct Rome-Tbilisi flight will not only strengthen the trade-commercial ties between the two countries, but will also increase the possibility of Georgian travelers roam around many countries worldwide. Each new air company entering the Georgian air market is one more step ahead made toward the tourism development, what TAV Georgia always meets with delight and appreciation.”
Up to today the only way to travel to Italy for Georgians was via third countries.
Over the past year air companies Air Astana, China Southern Airlines, Ata Airlines, Taban Airlines, Ural Airways, Fly Dubai and Air Cairo had entered Georgian air market and Qatar Airways will start operations in February 2012. In the nearest future the list will be enriched with another famous air carrier- Alitalia.

http://finchannel.com/Main_News/Trav...ce_to_Tbilisi/ (http://finchannel.com/Main_News/Travel_Biz/99507_Alitalia_to_Start_Service_to_Tbilisi/)

Alitalia launched 4 flights from rome to Riyadh Saudi Arabia I'm so happy good addition to RUH

http://i220.photobucket.com/albums/dd136/djoledjole/SAM_1573.jpg

http://cdn-www.airliners.net/aviation-photos/photos/8/3/0/2063038.jpg

^^ Good picture, but not the best quality. I surprised it made on airliners because they tend to be picky with photos.

^^ Good picture, but not the best quality. I surprised it made on airliners because they tend to be picky with photos.

It's probably because it's a very rare shot, 777 at St. Marteen.

It's probably because it's a very rare shot, 777 at St. Marteen.

also, you don't see Alitalia very often there.
(and it is not that bad shot, it wouldn't be on airliners.net if it was bad)

http://cdn-www.airliners.net/aviation-photos/photos/8/3/0/2063038.jpg

:wallbash: :wallbash:

Deleted Osaka for a charter route. :wallbash:

When can see the new A330 on FCO - YYZ ? Also I think Condor picked up some used AZ B767s.

Btw I see they are selling their old B767. How much are they going for? I can see EI-CRM wearing CONDOR colours.

http://cdn-www.airliners.net/aviation-photos/photos/7/0/2/1816207.jpg

Good news for us from Toronto. The A330 will be deployed as of mid October. Forza Alitalia!