Etihad submits non-binding offer for Alitalia
Etihad was named in the Italian press as one the airlines that had submitted a non-binding offer for total or partial takeover of Alitalia, alongside the Irish low-cost carrier Ryanair.
Etihad Airways has emerged as one of around 10 bidders interested in acquiring a partial or full stake in the Italian airline Alitalia, suggesting the Abu Dhabi-based carrier remains committed to its investment in the troubled airline.
The non-binding bid, submitted ahead of a deadline on Friday, also suggests that Etihad may not be ready to reverse course on its international investment strategy, despite last week selling off its stake in Switzerland’s Darwin Airline following a strategic review launched last year.
This weekend Etihad was named in the Italian press as one the airlines that had submitted a non-binding offer for total or partial takeover of Alitalia, alongside the Irish low-cost carrier Ryanair.
A source with knowledge of the proceedings confirmed to The National that Etihad was one of the bidders.
“Strong ties continue to exist between Alitalia and Etihad Aviation Group and we remain open to exploring all options to maintain and potentially deepen those ties for mutual benefit,” an Etihad spokesman told The National on Saturday, giving no further details.
Three months ago, Etihad appeared ready to walk away from its 49 per cent shareholding stake in Alitalia, after the Italian carrier was put into administration following a €2 billion (Dh8.56bn) recapitalisation deal that was vetoed by Alitalia employees.
“Without the support of all stakeholders for that restructuring, we aren’t prepared to continue to invest,” said Etihad’s then chief executive James Hogan.
The expression of interest by Etihad and others does not necessarily equate to a desire to take the airline on as a going concern, according to John Strickland, an aviation analyst at the London-based JLS Consulting.
“Airlines may well bid on a defensive basis to obtain information as part of the process and to stake a claim to the parts they may be interested in,” Mr Strickland said. “It is not likely that any airline would have any interest in the entirety of Alitalia as it stands today with its legacy of challenges.”
Eithad acquired a 49 per cent stake in Alitalia in 2014 as part of its global expansion drive, with a view to making the airline profitable again by 2017. But the airline’s passenger numbers continued to fall amid stiff competition from low-cost carriers including Ryanair.
The Italian government put the airline up for sale in May, in a bid to avert its liquidation.
The poor performance of Alitalia, alongside other subsidiaries including Germany’s Air Berlin, led Etihad to launch a review of its international investment strategy late last year.
Mr Hogan, widely seen as the pioneer of thatstrategy, left the airline earlier this month.
Last month Etihad walked away from negotiations with German tourism operator Tui Group over a joint venture between the company’s Tui Fly airline and Air Berlin subsidiary Niki, in a sign that its international acquisition strategy had changed.
That shift seemed to be confirmed by the Abu Dhabi carrier last week, with the sale of its shareholding in Darwin Airline, which it had re-branded as Etihad Regional.
Kevin Knight, Etihad Aviation Group’s chief of strategy, described the sale as “a result of the ongoing strategic review of our investments".
Updated: July 22, 2017 09:13 PM