Alitalia (AZA, Rome Fiumicino) will decide this month on whether or not to invest in Air Malta (Malta International) the MaltaToday newspaper has reported.
The announcement comes after a protracted six month-long due diligence by the Italians on whether or not to finalize a Memorandum of Understanding (MOU) signed with the Maltese government and Air Malta's board back in March. It concluded, the deal could see Alitalia acquiring a 49% stake in Air Malta.
A final decision was originally scheduled to have been taken in late July before the deadline was pushed back to September.
However, while an agreement in principle has reportedly been reached, Malta's Prime Minister Joseph Muscat has said he is very close to breaking off the deal amid concerns the tie-up may not benefit either the country or Air Malta's employees.
Speaking at a political rally this past weekend, Muscat said that in the event the Alitalia deal faltered, his government would be open to considering direct investment from local investors but that a strong foreign strategic partner would still be the ideal choice.
“A sole company cannot compete with an international network… competitiveness is affected by the best deal obtained from other airports and the price by which fuel is bought," he said. "Air Malta needs to find a way to tap into the international markets and this can only be achieved through a strategic partner."
In a bid to spruce up the carrier for investors, Malta has pledged to absorb Air Malta's debt while placing it employees into newly spun-off subsidiaries.
