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No last ditch deal for Alitalia as Etihad backs Board decision

Posted 25 April 2017 · Add Comment

Workers at the Italian national carrier Alitalia have voted against job cuts aimed at salvaging the cash-strapped Italian airline, pushing it toward administration for the second time in a decade.

The $2.2 billion recapitalisation tied to the savings plan is “effectively dead” and Alitalia will start appropriate “legal procedures” as funds run out.
The Italian government has said it won’t nationalise Alitalia and Etihad – which has been a major backer of Alitalia – has said it supports the management in starting procedures.
James Hogan, president and CEO of the Etihad Aviation Group, and vice chairman of Alitalia, said:  “We deeply regret the Alitalia staff vote outcome, which means that all parties will lose:  Alitalia’s employees, its customers and its shareholders, and ultimately also Italy, for which Alitalia is an ambassador all over the world. 
“Alitalia’s shareholders, including Etihad Airways, have provided vast amounts of financial and commercial support during the past three years. Jointly with the Italian shareholders, Etihad had reaffirmed its strong commitment and principal willingness to support the airline with a package worth nearly €2 billion in aggregate to help fund Alitalia’s new five-year business plan. A key condition to this commitment was that an agreed and concerted effort would be made by all interested parties, including the unions. 
“The preliminary agreement with unions that was made possible and supported by the union leaders, Alitalia management, the Italian Prime Minister and three government ministers would have helped secure Alitalia’s future. The rejection of this agreement in the staff ballot is deeply disappointing.   
“As a minority shareholder in Alitalia we support the Board’s decision today to convene a shareholder’s meeting on April 27, to start preparing the procedures provided by the law.”


 

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