Berlusconi sees Italian bid for Alitalia in weeks

ROME - Italy's prime minister-elect Silvio Berlusconi said on Wednesday an Italian business group plus banks and airlines -- none of whom were named -- would make a bid for Alitalia after a few weeks of due diligence.

By (Reuters)

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Published: Wed 23 Apr 2008, 6:20 PM

Last updated: Sun 5 Apr 2015, 11:42 AM

But he said a home-grown takeover would still mean "painful" reductions in personnel at the loss-making airline, where trade unions rejected a bid by Air France-KLM because it involved job cuts.

The outgoing centre-left government decided late on Tuesday -- in consultation with Berlusconi, who takes office next month -- to give the airline a 300 million euro ($475 million) emergency bridge loan to keep it flying. The airline's cash and short-term credits shrink by some 3 million euros a day.

That risks angering the European Commission, which has threatened court action over any further state aid for Alitalia.

"This has given Alitalia the means to survive a few months, time which will be used by a group of Italian entrepreneurs, aided by banks, professionals and airlines, to study Alitalia's accounts," Berlusconi told an Italian radio station.

"After due diligence of three, four or five weeks, this new group will present a binding offer and take over the running of Alitalia, which will involve a painful reduction in personnel," said the 71-year-old media mogul.

He pinned responsibility for the withdrawal this week of Air France-KLM's offer -- which he consistently opposed during the election campaign on the grounds that the flag carrier should stay in Italian hands -- on the "veto by trade unions".

"A company in Alitalia's condition can't keep making a loss, everyone has to show common sense, restructure the company and save as many jobs as possible, while making choices," he said.

"Nobody can guarantee the number of employees will remain at current levels in future," added Berlusconi, who beat the centre left in last week's election by a bigger than expected margin.

Hot potato

The conservative leader has entrusted his close business adviser Bruno Ermolli with the Alitalia dossier, which is likely to be his first major headache as prime minister.

"We are inheriting a problem which it would have been better to leave to the current government, rather than us getting the hot potato," said Berlusconi.

"But I believe it's in the national interest not to lose the flag-carrying airline, not just because of national pride but for valid economic reasons."

Brussels has not yet responded to the new government loan, but one official said that if it were not justified, "the Commission will come down very hard and will move as quickly as possible".

However, Berlusconi is manoeuvring to place a close ally in the EU's executive body as transport commissioner, the post responsible for coordinating issues such as Alitalia's future.

He has lined up Antonio Tajani, member of the European parliament for his own Forza Italia party, to take the post in a reshuffle after Italy's current Justice Commissioner, Franco Frattini, returns to become Berlusconi's foreign minister.

Alitalia shares, returning to limited trading after being suspended pending the loan decision, were indicted down 3.23 percent. A firm price will be set at the end of the session.

Berlusconi has also suggested talks with Aeroflot after hosting the Russian president last week but the airline -- which dropped out of an earlier Alitalia bid -- sounds cautious.



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