Alitalia/Etihad deal to be finalized on August 8th

Victoria
By Victoria August 4, 2014 18:04

Alitalia/Etihad deal to be finalized on August 8th

Alitalia and Etihad Airways will sign their €560 million ($756 million) investment agreement on August 8th, in which Etihad will acquire a 49% stake in the Italian flag carrier.

The deal was finalized when Etihad accepted a proposal from the Alitalia board last week.

Italian Minister of Infrastructure and Transport Maurizio Lupi, said: “There are still some details to agree on. But a date has been set for the signing – August 8th. Over the next week we’ll work to fix the last details.”

The terms of the investment include 2,174 job cuts at Alitalia, including 1’590 ground staff, 129 pilots, 420 flight attendants, and 35 from subsidiary Air One.

Lupi also stated that the establishment of Alitalia’s new 51% shareholder, Midco, will be formalized. Midco will be the intermediate company between Alitalia’s previous holding and the new company that will be formed once Etihad’s investment is formalized. The vehicle will allow Alitalia’s existing debt to be retained, while allowing current investors to invest in the new firm, which will be debt-free.

Alitalia’s board will also lobby its shareholders to approve a €300 million capital increase to help shore up the airline’s finances until the Etihad deal is completed.

Victoria
By Victoria August 4, 2014 18:04