The Italian government is looking at establishing an emergency fund for Alitalia (AZA, Rome Fiumicino) in the event the carrier's shareholders hold off on providing capital for its restructuring plan.
Bloomberg quotes informed sources as saying that with Alitalia running out of cash, Etihad Airways (EY, Abu Dhabi International), Alitalia's 49% shareholder, has pledged to provide half of the EUR400 million (USD432 million) of contingency equity the carrier may need with the Italian state providing the remainder through a state-backed guarantee issued through Cassa Depositi e Prestiti. Use of the state-owned lender would allow Alitalia to meet European Commission (EC) rules governing state aid to bloc-owned airlines.
Management earlier this month said the restructuring plan would see the loss-making carrier lay-off just over 2,000 staff as it aims to make EUR1 billion (USD1.06 billion) in savings through 2019.
Italian Minister for Economic Development, Carlo Calenda, told lawmakers this week that the plan includes equity and credit lines totaling EUR2 billion, of which EUR900 million would be provided by Etihad. However, shareholders have conditioned funding on combative unions accepting the reduction in head-count, an increasingly unlikely proposition given angry reactions during a meeting with government and airline management this week.
La Repubblica newspaper reported last month that Alitalia has only enough liquidity to last it through mid-April following which emergency funding would be needed.
