MILAN (Reuters) - The investment of state-owned Poste in Alitalia is an emergency move to keep the struggling airline in business and allow it to search for foreign partners without humiliating itself, Italy’s Prime Minister Enrico Letta told an Italian daily.
The carrier should now enter a international alliance as soon as possible and change radically its business strategy, Letta was quoted as saying by Il Sole 24 Ore on Saturday.
“Alitalia should negotiate, without the hat in hand, to enter a large international alliance,” Letta said according to the newspaper, adding, “Let’s do it quickly.”
The near-bankrupt carrier was thrown a lifeline on Friday when its board members - including cautious top shareholder Air France-KLM (AIRF.PA) - approved a capital increase as part of a government-led 500-million-euro bailout.
Italy’s Post office agreed to put in 75 million euros ($102 million)for any unsubscribed shares in a 300-million-euro capital increase offered to existing shareholders, while banks Intesa Sanpaolo (ISP.MI) and Unicredit (CRDI.MI) will guarantee to subscribe for up to 100 million euros not taken up.
Letta defended the government’s choice, saying the investment by Poste was not a public intervention to bring the former flagship carrier under state control, but an emergency move to foster shareholders to be responsible.
“The intervention of Poste forced the private (shareholders) to invest to keep Alitalia in business and to give it a future,” he was quote as saying.
A radical change of the carrier’s business plan is now a priority, he said.
“Stop with a model that imply Alitalia going alone, that considers the carrier like a person with noble origins now in disgrace,” Letta said.
Top shareholder Air France-KLM, with a 25 percent stake and in the middle of its own restructuring, said it would only make a decision on whether to take part in the cash call after Alitalia’s shareholder meeting scheduled for Monday.
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Reporting by Francesca Landini; editing by Ron Askew