Alitalia to be nationalised for €3 billion

Alitalia Ita, the successor company to the troubled Alitalia, is to be established with 100 per cent ownership by the Italian Ministry for the Economy, the Italian government announced on Friday.

The bailout of Alitalia, which has been in administration for the past three years, will costs the Italian taxpayer €3 billion, the ministry said.

“The ministers of the economy, industry, transport and labor signed on Friday the founding decree of the new company that emerges from 11 years of difficult private management and three failed restructuring attempts, which are weighed down by the problems aggravated by the crisis of the coronavirus. The first challenge is the new industrial plan for the pandemic to be presented within 30 days to Parliament, which will then have to evaluate the decree. The actual take-off of the new Alitalia with Francesco Caio, president and Fabio Lazzerini, CEO, is scheduled for early 2021,” the announcement said.

Alitalia, while technically in administration for reorganisation, was still flying, and has been hit hard by the COVID-19 crisis. The airline has had to lay off about 7, 000 workers, and has sharply limited capacity and the number of flights.

The current plan for the new Alitalia Ita is to remain as a full service airline — a plan to move it into the budget sector has been rejected.

“This new airline is taking form at a time when air travel demand is low, and there is an over-abundance of capacity across the world. It seems like no matter which direction this new Italian carrier goes; it will have the odds stacked against it,” comments one analyst.

Alitalia has been a troubled airline with alternating phases for almost thirty years. The latest convulsion in Alitalia’s troubled history had begun as early as November last year, well before the pandemic, when the latest purchase offers for the company were withdrawn and the government was faced with the difficult choice of making the company fail. or implement a new public intervention, the third in just over ten years.

 

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