Fast-growing Gulf carrier Etihad Airways said that it plans to transform the financial fortunes of Italy’s loss-making national airline Alitalia, by providing a €560m (US$750m) capital injection in return for a 49% stake.
Etihad is owned by the government of Abu Dhabi, capital of the United Arab Emirates (UAE). The company, a
2014 gtnews awards winner
in the financial planning and analysis (FP&A) category, intends to restructure Alitalia and plans to work on returning the Italian airline to profitability by 2017.
Etihad Airways’ chief executive officer (CEO) James Hogan announced the three-year plan to revive the Alitalia brand at a Rome press conference, saying it was a strong airline but “a poor business financially” that needed restructuring.
“If we didn’t believe Alitalia could restructure and win we wouldn’t be here,” he said alongside his Alitalia counterpart, Gabriele Del Torchio. “The sexiest airline in Europe should be Alitalia.”
A deal was agreed after months of negotiations over debt restructuring, proposed job cuts and other issues that sparked fierce opposition from Italian unions. Airline workers have staged wildcat strikes at Rome’s main airport this week in protest against the deal.
Acquiring a major stake in Italy’s national carrier is the latest in Etihad’s growing collection of foreign investments that also includes holdings in AirBerlin, Air Seychelles, Virgin Australia, Aer Lingus, Air Serbia and Jet Airways.
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