Alitalia ready for state bailout after appointment of new management

Italy’s government is reportedly set to finalise plans to renationalise Alitalia later this week, after appointing new management for the perennially loss-making airline.

A long-delayed decree offering 3 billion euros (3.4 billion dollars) for the rescue of Alitalia is set to be approved by the cabinet on Thursday, the Il Messaggero newspaper reported on Tuesday.

The report came a day after Prime Minister Giuseppe Conte filled the leadership positions of an airline that has not turned a profit since 2002.

Fabio Lazzerini, an Alitalia executive, was named chief executive, and Francesco Caio, chairman of pipeline and drilling firm Saipem and a former chief of the postal service, was named president.

According to multiple media reports, German Joerg Eberhard, head of Lufthansa’s Italian subsidiary Air Dolomiti, was considered and passed over for the chief executive position.

The Italian government’s plan is to pour the 3 billion euros into a new state-controlled company that will take over Alitalia’s assets, leaving its debts to a bankruptcy administrator.

Industry Minister Stefano Patuanelli on June 23, told lawmakers that the new Alitalia would focus on more profitable long-haul flights, rationalise its fleet but also avoid major job losses.

Alitalia, which has been under government controlled administration since May 2017, currently has around 11,000 staff, according to a spokesman.

Widespread scepticism remains about its chances of recovery, after a track record in the last decades of several failed efforts to revive it and multiple state bailouts.

However, Alitalia is not alone now in needing government support, as the novel coronavirus pandemic has destabilised the entire airline sector.

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