Abu Dhabi carrier Etihad Airways and Alitalia signed an investment agreement on Friday that will see Etihad acquire a 49-percent stake in the troubled Italian flagship airline. The overall “transaction implementation agreement,” which the airlines valued at €1,758 billion ($2.35 billion), will recapitalize Alitalia with the aim of restoring it to profitability by 2017.
The debt crisis in Italy has certainly taken its toll on a wide cross section of the country’s economy, and Verona-based regional airline Air Dolomiti hasn’t enjoyed special immunity from the effects. What CEO Michael Kraus called a brilliant period of expansion from 2005 to 2010 has not only ended, but passenger counts have actually fallen over the past two years in the Italian air transport market.
Etihad Airways on Tuesday announced its strongest ever passenger and cargo volumes for a first quarter, just as its negotiations for a 49-percent stake in Alitalia regain momentum. The airline, whose bid for a piece of Alitalia marks yet another effort to expand its already considerable global influence, logged $1.4 billion in total revenues during the three-month period, marking a year-on-year increase of 27 percent.
Etihad Airways appears close to making a final decision as to whether or not to buy an equity stake in Alitalia. Speaking during a March 3 conference call about the Abu Dhabi-based airline’s latest quarterly financial results, CEO James Hogan confirmed that Etihad has entered the final stage of due diligence in evaluating the struggling Italian flagcarrier.
UK regional airline Flybe has raised almost $260 million in fresh capital through a share flotation launched February 20 in London. The company, which has been battling to rebuild its business model with an aggressive program of cost cutting, is issuing a total of up to 141.5 million new shares to raise £155.6 million. The offer price on February 20 was 110p per share, representing a 7.2-percent discount on the stock’s 118.5p mid-market price on February 19.
Facing high costs and increased competition, Air France-KLM’s management must pick its battles. Having announced plans for up to 2,800 job cuts on September 18, the European airline this week deferred a decision on whether or not it will provide further investment to plug holes in the sieve-like balance sheet of Alitalia. It holds a 25-percent stake in the Italian carrier, and Italy’s government has indicated it would be willing to see the Franco-Dutch group increase that share to 50 percent.
An ATR 72 operated under the Alitalia network by Romanian carrier Carpatair was substantially damaged on February 2 when the crew lost control of the aircraft on landing at Rome Fiumicino Airport in Italy (LIRF). The wind at the time of the accident was approximately 90 degrees to Runway 16, gusting to 41 knots.
Four of the 50 people aboard were injured, two seriously.
Embraer and Alitalia finalized an agreement for the delivery of 15 E175s and five E190s through a lease structure arranged by third parties, the Brazilian manufacturer announced today.
Bombardier Aerospace has lost its firm order for 15 CRJ1000s from MyAir after Italy grounded the airline and suspended its license to fly on July 24. The Italian civil aviation authority said months of financial troubles had made MyAir’s services unreliable and that it would not allow it to resume operations until it presents a viable financial plan.
Embraer delivered the first of 30 E-Jets ordered by Lufthansa–a 116-seat E195–
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