Italy Picks Delta, Air France-KLM to Privatize Flag Carrier ITA Airways -- Update
August 31 2022 - 7:22AM
Dow Jones News
By Mauro Orru
The Italian government said Wednesday that it would hold
exclusive talks with Delta Air Lines Inc. and Air France-KLM to
privatize ITA Airways, as Prime Minister Mario Draghi pushes for a
deal before the end of his mandate ahead of elections in
September.
Italy's finance ministry said that a bid from the consortium,
that also includes investment firm Certares Management LLC, emerged
as the most suitable as the government seeks to hand over control
of ITA Airways, Italy's reincarnated flag carrier that succeeded
loss-making Alitalia.
"At the end of exclusive negotiations, binding agreements will
be signed only if the outcome is fully satisfactory for public
shareholders," the ministry said in a statement.
The consortium beat a rival offer from MSC Mediterranean
Shipping Co. and Germany's Deutsche Lufthansa AG.
A spokesman for Lufthansa said the carrier had taken note of the
Italian government's decision.
"Our joint offer together with MSC was the better solution for
ITA, from our point of view. Apparently, a path is now being chosen
that allows for more state influence and does not provide for a
complete privatization of ITA," the spokesman said.
MSC didn't respond to a request for comment.
ITA Airways launched operations in October last year with less
than half of Alitalia's fleet as it focused on profitable
routes.
Alitalia had been loss-making since 2008. By 2017, the airline
had lost access to credit markets and the Italian government
stepped in with loans worth hundreds of millions of euros, placing
Alitalia into special bankruptcy proceedings under Italian
bankruptcy law.
For months, the Draghi administration has been seeking a partner
or buyer for ITA Airways in an effort to reduce state influence.
Mr. Draghi said during a press conference earlier this month that
he wouldn't "leave the ITA Airways question with a new government,"
insisting he would find a winner "in a short time".
Mr. Draghi tendered his resignation in July after his coalition
collapsed because of differences over how to respond to the fallout
of the war in Ukraine. The country is heading for elections at the
end of September.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
August 31, 2022 07:07 ET (11:07 GMT)
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