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Italy economy minister backs Air France-KLM bid for Alitalia

Italy economy minister backs Air France-KLM bid for Alitalia

Italy's economics minister said Friday he supported Air France-KLM's bid for the troubled national carrier Alitalia and said the two groups would open exclusive talks immediately.
Economics Minister Tommaso Padoa-Schioppa, speaking after a Cabinet meeting, said the talks would last eight weeks and be conducted by the company's management. The Economics Ministry holds a 49.9 percent stake in the airline.
"I expressed a favorable opinion that Alitalia hold exclusive talks with Air France-KLM," Padoa-Schioppa told journalists. "A phase of about eight weeks of exclusive talks conducted by Alitalia begins now."
Alitalia shares _ which had been briefly suspended pending a ministry statement _ rose 5.7 percent to euro0.782 (US$1.15) at the Milan Stock exchange shortly after reopening.
Air France-KLM, the world's largest carrier by revenue, had been seen as a top contender for the Italian airline, which has been losing money for years. Last week, the board of Alitalia also chose Air France-KLM over a competing offer by Italian carrier Air One.
"We are convinced that the indication given by Alitalia's board is the right one," Padoa-Schioppa said.
The Economics Ministry received a mandate by the Cabinet to monitor the talks on behalf of the government, said a ministry statement. After these talks are over, Air France-KLM is expected to make a binding offer which must be voted on by the Italian government.
Padoa-Schioppa said he expects a positive outcome, but added that the situation for Alitalia remains "extremely delicate."
The government had been expected to decide by mid-January. Calls for a quick decision came from Alitalia's Chairman Maurizio Prato in remarks to the financial daily Il Sole 24 Ore this week.
The government has been trying to off-load the loss-making Alitalia since December 2006. It was forced to scrap a tender last summer after all potential buyers gradually pulled out, saying the terms were too stringent and would not allow them to implement a turnaround strategy.
(ar/nvw)


Updated : 2021-04-17 20:43 GMT+08:00