August 3, 2018 / 3:14 PM / 2 months ago

Alitalia did not consider offers from investors 'appropriate' - report

MILAN (Reuters) - The three offers that Alitalia received during a sales process kicked off by Italy’s previous government were not appropriate for the Italian carrier, the state-appointed commissioners who have run the airline since last year said in a report on Friday.

FILE PHOTO: An Alitalia plane takes off from the Leonardo da Vinci-Fiumicino Airport in Rome, Italy, June 21, 2018. REUTERS/Stefano Rellandini/File Photo

Uncertainty now looms over Alitalia, once a symbol of Italy’s buoyant post-war economy and national prestige, after the search for new investors was put on hold by the country’s new government.

The commissioners’ report did not say who had made the three offers but added that Alitalia did not enter exclusive negotiations with any of the potential buyers because they had all lacked commitment and essential elements such as bid bonds, contractual documents and industrial plans.

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EasyJet, Lufthansa and Wizz Air all submitted expressions of interest after Alitalia was put under special administration in May last year for the second time in a decade in the face of increased competition from low-cost carriers and high speed trains.

Italy’s new transport minister said last month that 51 percent of Alitalia was to be kept in Italian hands “but with a strong investor next to it,” without giving further details on how the State would intervene and whether a sale would go ahead.

Political uncertainty around Italy’s national elections and the subsequent change of government had meant interested investors taking a conservative approach, industry sources said.

Alitalia’s commissioners have been putting the carrier’s books in order and first-half revenues rose 4.3 percent year-on-year to 1.4 billion euros (£1.24 billion). Costs fell 8.6 percent to 1.5 billion euros, despite those linked to fuel rising by almost 22 percent.

The airline also cut its core loss to 124 million euros.

Reporting by Alberto Sisto, writing by Giulia Segreti, editing by Alexander Smith

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