The deadline for submitting binding offers for Alitalia heir ITA Airways (AZ, Rome Fiumicino) expired at midnight on Monday, May 23. However, as part of the bid widely seen as having the best chance, Lufthansa (LH, Frankfurt International) has reportedly halved its interest to a 20% stake.
According to local media, insiders confirmed reports that emerged earlier this month, that two offers for ITA are on the table at Italy’s Ministry of Economy and Finance: a consortium made up of Lufthansa and shipping giant MSC, and US-based investment fund Certares, which is reportedly working with Air France-KLM and Delta Air Lines (DL, Atlanta Hartsfield Jackson).
A third interested party, low-cost-carrier investor Indigo Partners, another US fund, appears to have withdrawn, the reason reportedly being that European Union legislation requires that the majority shareholder of a European airline be based in Europe and Indigo had not managed to find a suitable partner.
In the privatisation process, it is expected that the government will retain a minority stake of between 10% and 30%. Rome will now examine the offers looking not only at the price but at the commitments the would-be suitors are willing to make.
On May 24, a source close to the process told Reuters that Lufthansa wants to acquire a 20% stake in ITA, leaving MSC with 60% and the Italian state with 20%. In January, sources told the news agency Lufthansa was hunting for 40%.
Lufthansa has confirmed it submitted a binding offer together with MSC but declined to comment on the figures. Air France (AF, Paris CDG) has only reiterated that it is willing to strengthen its commercial ties with the Italian flag carrier.
ITA Airways is worth EUR1 billion to EUR2 billion euros (USD1.07-2.14 billion), local reports said. The government is expected to say in the coming weeks which of the two groups exclusive negotiations will be conducted with, as it wants the sale completed before July. The “data room” of ITA Airways’ financial documents, accounts, and confidential data closed at the end of the working day on May 23 together with the bidding deadline.
In related news, Swissport has won a tender which Alitalia in “extraordinary administration” called to buy its groundhandling business at Rome Fiumicino, Società Aerea Italiana S.p.A. In a statement, Marina Bottelli, Swissport’s general manager for Italy, said: “We look forward to welcoming the first of 1,451 former Alitalia employees.” But local media pointed out that total number of staff at Fiumicino handling as of January 10, 2022, was 2,451.