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Berlusconi outlines concerns over Alitalia direction

Italian prime ministerial candidate Silvio Berlusconi has outlined his concerns over developments at struggling national carrier Alitalia and the airline’s plans to scale back its operations at Milan.

Former prime minister Berlusconi is currently ahead in opinion polls as Italy prepares to replace Romano Prodi’s Government which collapsed early this year.

Under Prodi’s leadership, the Italian Government backed Alitalia management’s selection of Air France-KLM as its preferred privatisation partner.

Exclusive talks, running since the start of the year, are due for completion in the middle of this month. At this point Air France-KLM will decide on whether to make a binding offer for its SkyTeam partner.

But the fall of the Prodi Government led to speculation it could derail completion of a deal with Air France-KLM. Officials from Berlusconi’s party have previously been quoted as saying they believe a decision should be taken by the new government – elections in Italy will be held next month – but that they would respect any agreements made before then.

Now in comments reported following an interview on Italian television, Berlusconi is quoted as outlining his preference for Italian investment in the carrier. “I'm very critical of the direction that's been taken. I think Italy should not deprive itself of a flag carrier,” he is quoted as saying.

He was also critical of Alitalia’s plans to scale back its operations at Milan – the carrier’s new business plan is to focus its hub operations on Rome Fiumicino.

On 4 March Alitalia’s share price saw another tough day on the stock market with it dropping more than 5% to €0.561. Further uncertainty emerged after an Italian court ruled a new tender should be opened for Italian airline group Volare – which Alitalia successfully bid for in 2006 – after backing an appeal by rival bidder, Italian carrier Air One.

Parent of Air One, AP Holdings, is separately continuing its legal efforts to enable it to present its consortium’s rival bid for Alitalia.

Alitalia management have consistently stressed the need for a swift resolution to its search for a new partner and has said the airline will need a capital increase in the region of €750 million by around mid-year.

Source:'s sister premium news site Air Transport Intelligence news

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