Is the End of the Alitalia Saga Near?

It’s been a busy week for Alitalia, and once the dust settles, we might finally have a solution regarding who is going to take a stab at fixing this sorry excuse for an airline. As promised, Intesa Sanpaolo has cobbled together a rescue plan. While this one seems more likely to work than any of the previous attempts, I’m still skeptical.

Alitalia Worst Airline EverThis plan gets a big group of Italian investors (up to 17, it appears) to put money into the airline, take over large domestic player Air One in the process, and slim down to a profitable operation.

It all sounds promising, right? I mean, you’ve got Italian turnaround expert Roberto Colannino leading the charge, so PM Berlusconi won’t start whining about how it’s not an Italian-enough group of people. Is it the best plan for Alitalia? Probably not. That died with the Air France/KLM debacle last year, but this certainly isn’t a terrible option.

And it does appear that the new Alitalia wants to work with one of the big three European groups. Air France/KLM was always the expected winner of that race, but there’s been talk of Lufthansa and now even hints of British Airways in the mix as well. Air France/KLM, it’s rumored, is talking about purchasing a minority stake in the new airline.

So all seems rosy, right? Not so fast. As usual, this deal depends upon the unions being willing to go along. They’re “hoping” to keep layoffs below 5,000, but my guess is that the unions won’t be too happy about that at all. Oh boy, more union fighting. Let’s see if they can somehow push this one through.

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10 Comments on "Is the End of the Alitalia Saga Near?"

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daren_siddall
Member

I think it is interesting how they are structuring the new company. Firstly separating off the main airline operations and merging it with Air One. Secondly isolating all the loss-making parts of the business along with the billion euros of debt which will then be liquidated. Yet another back door state-sanctioned subsidy. I read that the EU is looking closely at this deal. It’s very similar to what happened to Swissair. I wonder if Lufthansa will end up swallowing this new minnow too.

David SF eastbay
Member

I thing someone is obsessed with talking about Alitalia….lol

Nick Barnard
Member

Hmm.. Wonder if this is even legal — It seems if this was in the US all of those debt holders would be squawking to no end about the assets being legally separated from the liabilities in such a way.

David
Guest

Does this all sound fair to the Italian taxpayers ? Of course not.

But, the Govt is the one trying to make Alitalia work, and the Government has the right to make laws pretty much as it wishes – in particular changing the law covering bankruptcy specifically to make things easier for Alitalia

The EU may well look into this – but the worst outcome is the Italian Govt being ordered to pay fines to the EU (which they can afford). This means there’s nothing to stop the Government getting away with this !

OneHotProcessor
Guest

Good luck, Alitalia, with the unions.

David
Guest

Which airline will go bust next ?
There’s an Irish bookmaker, offering bets on which airline will fail next. I do not suggest anyone bets their own money, but it is certainly fun to see what the odds are for different airlines, based on bets people have made rather than just the people mouthing off to journalists !

http://www.paddypower.com/bet?action=go_type&category=SPECIALS&ev_class_id=45&ev_type_id=10368&promo=nov_Nextairlinetogobust&crea=lnk

Viera
Guest

2 weeks ago I purchased an airline ticket online for Alitalia flight from Boston to Rome (roundtrip) for 11/25-30. If Alitalia shuts down, will I loose my money or can I request my money back?

David
Guest

Viera – if you purchased the ticket through a travel agent website (and not just Alitalia’s website) get in contact with them. If you used a credit card, talk to the bank that issued your card.

Viera
Guest

David, thank you for the suggestion, I am waiting for Alitalia’s negotiations to end. I plan to contact 1800 Fly Europe that sold me the ticket online, however, I am trying to find out what my rights are before I call them, considering that the ticket was *nonrefundable*. Any advice on how to proceed would be appreciated (should I call the agency first or my credit card first). What are my rights as far as nonrefundable tickets go?

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