Arrivederci?

22 September 2008



Google
WWW Kensington Review

Alitalia Facing Liquidation

While most of the financial world focused its attention on the socialist takeover of the US economy, the special administrator who runs Italy's Alitalia airline was preparing to make one last try to sell off the troubled carrier. Last week, unions refused to go along with the conditions demanded by a potential rescuer. Today's public tender is its last chance to keep flying.

This would be a particularly embarrassing for Prime Minister Silvio Berlusconi who made saving the airline part of his campaign plan when he was returned to power in May. Previously, his party had opposed the sale of 49.9% of Alitalia to Air France-KLM, the approach of the previous government. Instead, he put together 16 business groups in the CAI consortium to buy the airline. It is this team that just walked away from the deal.

The special administrator, Augusto Fantozzi, told Il Messagero, “We will proceed with a public request [for offers]. It will formalize what I have been doing -- without any results so far despite all my efforts -- regarding the main assets." He added, “I continue to sound out the market.”

Without any offers, Italian Transport Minister Altero Matteoli believes that the government will have to shut the airline down within a week to 10 days. However, he warned that a decision would have to be made sooner than that. He reiterated, “The only option is that unions sign the agreement [with CAI]. All Alitalia flights will be grounded within a few days from now, as described in the law.”

Guglielmo Epifani, the head of the powerful Italian General Confederation of Labour, stated, “Bankruptcy would be a tragedy. Mr. Fantozzi is right to look for alternatives to bankruptcy. If he takes over the negotiations, we would return to the table.” The trouble is there doesn’t appear to be any reason for him to do so. If he can’t sell it, it has to go. Alitalia has sucked up too many euros over too many years to go on.

© Copyright 2008 by The Kensington Review, Jeff Myhre, PhD, Editor. No part of this publication may be reproduced without written consent. Produced using Fedora Linux.

Kensington Review Home