Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Italy works on extending Alitalia loan deadline: source

Published 10/06/2018, 11:16 AM
Updated 10/06/2018, 11:20 AM
© Reuters. An Alitalia airplane is seen before take off from the Leonardo da Vinci-Fiumicino Airport in Rome

ROME (Reuters) - Italy is working on an extension of as much as six months to a Dec. 15 deadline for Alitalia to repay a 900 million euro ($1 billion) loan meant to keep the airline afloat while it searches for a buyer, a government source said on Saturday.

Once a symbol of Italy's post-war economic boom, but recently in trouble due to competition from low-cost carriers and high speed trains, Alitalia was put under special administration last year after workers rejected a rescue plan.

As part of the process, Rome has been looking for a buyer, but it has been delayed because of a change of government.

Any extension to the bridge loan deadline may irk the European Commission, which has already been looking into whether it constituted state aid. It may also violate EU guidelines, which allow rescue loans only as a short-term emergency measure.

Alitalia declined to comment.

Officials within the populist government that came into power in June have said that Rome would like to put 51 percent of Alitalia in public hands, possibly via a tie-up with one of Italy's state-owned giants, flanked by a strong industrial player.

Gianfranco Battisti, the head of Italy's Ferrovie dello Stato (FS), said last month that Alitalia could be an opportunity for the state-owned railways group, adding he saw synergies in ticketing and routes.

However, Battisti said on Friday that FS was not focused on "financial participations in other companies" at the moment, in comments attributed to him by Italian newspapers on Saturday.

Earlier this year, EasyJet (L:EZJ), Lufthansa (DE:LHAG), and budget carrier Wizz Air (L:WIZZ) submitted expressions of interest in at least parts of Alitalia.

Industry Minister Luigi Di Maio, who this week promised to conclude the Alitalia question in November, has called a meeting with the airline's unions for Friday, Oct. 12.

The sale was supposed to be concluded by April 30, but that was moved to the end of October due to the government change.

© Reuters. An Alitalia airplane is seen before take off from the Leonardo da Vinci-Fiumicino Airport in Rome

($1 = 0.8679 euros)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.