Wednesday,
October 18, 2006
Alitalia,
Again In Crisis, Can Still Become Significant, Says Transport Minister
The ANNOTICO Report
Alitalia
is lurching into its second major crisis in less
than three years.
There are three options for Alitalia:
(1) a speedy sell-off; (2) leaving it to continue a downward path to
bankruptcy; (3) or restoring its fortunes.
A speedy sell-off would mean probably joining up
with an ally like Air
A restoration of fortunes would mean probably finding an Asian partner, a full merger or maybe just a strategic alliance.
An Asian partner would be preferable to a European
carrier, because Alitalia would earn more profits
from business class travel on long-haul flights to and from
Alitalia
already has a small cross-shareholding with Air
A solution to labor strife, meaning workforce
cuts, and eliminating one of the two duplicative hubs in
Alitalia
is Not on the brink because it had available liquidity
of 823m ($1bn) at the end of August. Its net debt stood at 932m.
Without wise Strategic moves, Alitalia
will face the same end as Swissair and Sabena [the Swiss and Belgian
airlines].
ALITALIA
SHOULD NOT BE SOLD OFF IN HURRY, CAN BECOME SIGNIFICANT FRIM- MINISTER
Forbes Magazine
AFX News Limited
October17.2006
MILAN
(AFX) - Alitalia SpA should
not be sold off in a hurry as part of an alliance with another airline, but
should first become a significant carrier, said transport minister Alessandro
Bianchi.
Speaking at a
parliamentary hearing, he said there are three options for Alitalia:
a speedy sell-off; leaving it to continue a downward path to bankruptcy; or
restoring its fortunes.
'A sell-off
today would mean someone would pay an enchanting price and this would result --
in the example of (joining up with) an ally like Air
'The objective
is returning Alitalia to a serious company,' he said.
'I believe we
don't have any possibility of revitalising Alitalia unless it is part of a wider reform of air
transport,' he said.
Bianchi said
today's meeting between prime minister Romano Prodi and Alitalia chairman and
CEO Giancarlo Cimoli is to see if Cimoli
is willing to help the government with preparing reforms.
Bianchi has
previously said he favours Cimoli's
departure, while last week the airline rebuked reported Prodi
comments that the airline would fail by end-January without government
measures.
Bianchi said a
working group started two weeks ago on the government's plan to boost Alitalia and the sector, and has set up meetings with all
the stakeholders in the sector, he said.
'The problems
of Alitalia are difficult, let's not hide them, but
one that we want to immediately avoid is a clash between Malpensa
(
There have
been reports the government favours Alitalia closing its hub at Malpensa
in order to concentrate on Fiumicino.
nigel.tutt@afxnews.com
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