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Old April 29th, 2008, 05:48 PM   #261
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Olympic is already the next one with the struggle between the governement of Greece and the EC.
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Old April 29th, 2008, 05:52 PM   #262
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Quote:
Originally Posted by eomer View Post
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.
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Old April 29th, 2008, 10:58 PM   #263
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Originally Posted by eomer View Post
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.
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Old April 30th, 2008, 04:47 AM   #264
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Originally Posted by Magellan View Post
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.
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Old April 30th, 2008, 12:41 PM   #265
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Quote:
Originally Posted by Rennes View Post

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.
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Old April 30th, 2008, 03:47 PM   #266
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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!!
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Old April 30th, 2008, 04:57 PM   #267
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TAP Portugal

Quote:
Originally Posted by Magellan View Post
... I think TAP is not far behind.
Quote:
Originally Posted by Lusitanea View Post
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.

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.
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Old May 5th, 2008, 06:38 PM   #268
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Legality of Load questioned

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?p...d=axypktIk1xPs
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Old May 13th, 2008, 10:53 PM   #269
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Renationalisation not an option

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?p...d=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

Last edited by Magellan; May 13th, 2008 at 11:11 PM.
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Old May 21st, 2008, 07:17 AM   #270
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New EU Transport Commissioner

The Italian Antonio Tajani, takes over as EU Transport Commissioner:
http://www.bloomberg.com/apps/news?p...d=aQIOeeOWjhJg
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Old May 26th, 2008, 02:26 PM   #271
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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.
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Old May 26th, 2008, 02:50 PM   #272
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Quote:
Originally Posted by hkskyline View Post
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.
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Old May 27th, 2008, 02:32 PM   #273
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If it can be substantiated, then it won't be a rumour
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Old May 27th, 2008, 02:41 PM   #274
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Quote:
Originally Posted by hkskyline View Post
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.
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Old May 29th, 2008, 07:50 AM   #275
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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.
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Old May 29th, 2008, 01:53 PM   #276
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Alitalia on brink of collapse?

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?p...d=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?p...d=azuK1kpBqb1A
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Old May 30th, 2008, 07:24 AM   #277
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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.
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Old May 30th, 2008, 02:12 PM   #278
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Italian Government now going for a fire sale:
http://uk.reuters.com/article/rbssIn...07538820080530
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Old May 30th, 2008, 04:42 PM   #279
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Quote:
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
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Old May 30th, 2008, 10:47 PM   #280
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Quote:
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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.
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