MILAN: Alitalia finally secured the ¤300m ($412m) it needs to keep flying over Christmas, a source said yesterday, concluding a drawn-out capital raising that showed how much work the airline has to convince investors it can survive.
Italy’s national carrier, having pocketed cash that analysts estimate will last it six months, now goes straight to its next challenge: A meeting with unions where sources said it will try to persuade them to sign up to thousands of job cuts.
The cash call was part of a bigger government-engineered rescue to keep Alitalia going while it searches for a new partner willing to invest in revamping its fleet and making it profitable in the longer term. The scale of that task was illustrated by the airline’s difficulty in persuading shareholders to sign up for fresh investment — many aired doubts over its proposed business plan or wanted to see tougher restructuring of the airline’s debt.
The source said Italy’s state-owned postal service, which had been lined up to commit up to ¤75m for any unsubscribed shares, had to participate in the cash call in the end, although to what extent was not yet known.
“Including subscriptions by existing shareholders, new investors and the investment by the postal service, the 300 million euro target has been reached,” the source said.
At the same time, Alitalia’s management is due to meet trade unions to present details of a revised industrial plan, which sources said could include up to 2,600 job cuts out of the airline’s total workforce of 14,000 people.
Unions say they are gearing up for a battle should layoffs at the airline be announced. Any tough restructuring of the airline to suit a foreign investor would also weigh on the already fragile coalition government of Enrico Letta.
Reuters
