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New twists in ITA sale saga

 

The tale of the intended sale of Italy's state-owned ITA Airways shows signs of heading for some kind of long-distance record, with new twists added this last week.

This week's developments included a confirmation by the Economics Minister in Italy's new right-wing government that it intends to go ahead with the sale set in motion by the previous government, and a split in the Lufthansa/MSC partnership that was once again tabbed as the likeliest buyer. In the meantime, the government is putting another €400 million into the carrier to keep it flying.

The partnership re-emerged as a top bidder after negotiations between the government and a group led by U.S. capital firm Certares, allied with AirFrance/KLM and Delta, failed. That group had been granted a short period as the exclusive bidder, although its cash offering was lower than the other group.

Lufthansa had partnered with Italian/Swiss shipping conglomerate MSC in a bid for 80% of the airline, leaving 20% for the government. Although their bid appeared for months to be the leader, the government was not happy with Lufthansa's insistence on having full control of the airline as a business, with Italy being only a part-owner with no participation in management.

With MSC now saying it is no longer interested, Lufthansa has reaffirmed its interest, but only in a "real privatization of the airline." Lufthansa has not said whether its new offer would be for 80% or some other portion.

However, while the Economics Minister told press that "We are open to anybody who wants to participate in the privatization." The airline, created as a successor to the long-running bankruptcy and rescue cycle of the old Alitalia, was always intended to be privatized, as part of an agreement with the EU to allow state financing.

The best part of every trip is realizing that it has upset your expectations

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UPDATE

Well, an update to this story should never be a surprise, but...

Since the story above was posted, there are new developments and new rumors over ITA. One, reported by Bloomberg News, is that the Italian state-owned rail system FS (better known as Trenitalia) might be interested, possibly partnered with Lufthansa. It had previously been part of a consortium that offered a bit to keep Alitalia afloat in 2018.

Another possible bidder, either on its own or as part of a joint bid, is Atlantia, an Italian company that owns and/or operates significant portions of Italy's infrastructure including the Autostrada expressways. Largely controlled by the Benetton family, it also was interested in an Alitalia bid, but dropped out after receiving bad maintenance marks in the collapse of a bridge in Genoa. The company currently operates Rome's airports.

Stay tuned... and keep your guesses flexible!

The best part of every trip is realizing that it has upset your expectations

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