Etihad Airways has written to Alitalia, detailing the conditions for an investment in the loss-making carrier.
“The Italian government appreciates the strategic importance of this transaction and looks favourably at the Etihad Airways-Alitalia partnership,” the two carriers said in a joint statement.
Once approved by the Alitalia board the pair said they would proceed to final documentation to complete the deal in line with European Union and other regulatory requirements.
“We are delighted to be able to move forward with this process and look forward to the successful conclusion of the proposed transaction with Alitalia,” said the Etihad president and chief executive James Hogan.
Etihad and Alitalia have been talking about a potential deal since last last year that would involve the Abu Dhabi carrier pumping about US$300 million to acquire 40 per cent of the carrier.
“This is an excellent outcome for Alitalia,” said Gabriele Del Torchio, the chief executive of Alitalia. “This investment will provide financial stability and confirms Alitalia’s key strategic role as an infrastructure player in the travel and tourism industry in Italy for long-term growth.”
Earlier Italy’s transport minister Maurizio Lupi told the Italian news agency ANSA: “I have reason to say that it is a positive letter.”
Alitalia serves one of Europe’s biggest travel markets and flies about 25 million passengers every year. But it also sits on a debt pile of €800m (Dh4 billion). Domestically, it faces pressures from budget carriers and high-speed trains.
business@thenational.ae
Follow us on Twitter @Ind_Insights