Italy Makes Third Attempt To Sell Alitalia
Italy on Friday launched its third attempt in 18 months to find a buyer for Alitalia, naming the country's biggest bank as adviser and issuing secretive new rules in the hope of speeding up the ailing airline's sale.
The new conservative government said bank Intesa Sanpaolo would seek one or more buyers for the state's 49.9 percent stake in Alitalia, which is struggling for survival after Air France-KLM pulled out of a takeover.
Under the new rules, there will be no auction and the government will not be obliged to disclose information about the sale until an offer has been made, unlike the normal requirement for listed companies, Economy Minister Tremonti said.
"The situation is so serious and urgent that the usual privatization procedures which failed in the past have to be ruled out," Tremonti told a news conference.
He made no mention of a timeframe for the sale nor of any potential buyers, but said Intesa Sanpaolo was free to take part itself in any bid. Intesa's chief executive Corrado Passera declined to comment.
Tremonti blamed the previous administration, which first put the state's 49.9 percent stake in Alitalia up for sale in December 2006, for failing to close the deal successfully.
"We have learned lessons from the past 18 months," said Tremonti, who took office in Silvio Berlusconi's new government this month.
"There is a crisis, there is a failure of the privatization process and Air France is not there anymore," he said.
Berlusconi had vocally opposed the Air France-KLM bid for Alitalia and turned it into a major issue in the April election he went on to win.
Berlusconi has repeatedly promised that an Italian consortium of investors will rescue Alitalia, but the bidders have so far failed to emerge.
"Passera is the only one who can take charge of the situation," said another minister who asked not to be named.
Alitalia's board will meet on June 3 to discuss its prospects. The airline received a badly-needed financial lifeline this week, when the government converted a EUR300 million euro emergency loan to the airline into company capital. Tremonti said this was the only way to prevent the national carrier from going bankrupt or being put under special administration.
That loan is being scrutinized by the European Commission to see whether it violates rules barring state aid.
Alitalia said on Tuesday it had posted a 2007 net loss of EUR495 million (USD$778.3 million) and reiterated it quickly needed fresh capital to keep flying.
On Friday, the airline said its short-term liquidity at the end of April fell to EUR174 million from EUR180 million a month earlier, and that its net debt stood at EUR1.36 billion, slightly up from March.
The previous government's first attempt to sell Alitalia in an auction ended in failure last July when all the bidders pulled out.
The company later began exclusive talks with Air France-KLM after rejecting a rival offer from smaller Italian airline Air One, which was backed by Intesa Sanpaolo.
But that deal also fell apart because of union opposition and political pressures during the election campaign.
Air France-KLM said this week it seemed "impossible" that it could resume talks with the Italian airline.