Source: Reuters Author: Valentina Za, Francesca Piscioneri 07/17/2008
Subject Concerned:
Two buyers voiced interest in Alitalia's cargo assets on Jul. 17, as Prime Minister Silvio Berlusconi said there were now so many would-be investors in the long-hawked airline that some would have to be rejected.
Luxembourg-based private equity firm Equinox and holding company Miro Radici Finance, which has airport and cargo interests, said in a joint statement they had informed the near-bankrupt airline's sale adviser of their interest in its cargo assets.
"Equinox and Miro Radici Finance ... are ready to assess the possibility of creating a newco -- which they would head industrially -- to absorb Alitalia's cargo activities," the two said.
They added the new company could be based at Milan's Malpensa airport, the former north Italian hub for Alitalia which has suffered a sharp loss of business since the ailing national airline radically cut flights there to save costs.
On Jul. 17, Malpensa operator SEA said passengers at the airport would fall nearly 17 percent to 28.8 million this year, largely due to the cutbacks by Alitalia -- which is limping along with losses of EUR2 million a day.
SEA is seeking damages of EUR1.2 billion from Alitalia over the cutbacks in flights and regional politicians are lobbying to boost business at the airport, which serves the country's financial capital, Milan.
Double Demand?
Broadcasting billionaire Berlusconi on Jul. 17 restated his belief that a consortium of Italian businesses would bid for the airline soon.
"I am convinced that in the fairly short term we will present an industrial plan for Alitalia which will allow us to have a flag carrier which is profitable and, according to what I know, underwritten by many Italian business people," he told reporters.
"We have had to say no because there is double the interest than is needed," he added.
Alitalia was first put up for sale at the start of 2007 by the previous centre-left government but attempts to find a buyer for the state's 49.9 percent stake failed. Berlusconi's centre-right government embarked on the latest effort in May.
It picked Italian bank Intesa Sanpaolo as sale adviser and Berlusconi has consistently said he would find an Italian buyer for the airline -- whose combative unions helped scupper a deal earlier this year with Air France-KLM.
Shares in Alitalia have been suspended from trade since the beginning of June. The company had a market capitalization of around EUR610 million (US$966.9 million) then.
In cargo, Alitalia employs a dedicated fleet of five MD-11 special freighters -- as well as the holds of its passenger planes and partnerships with other airlines.
It transports goods from Malpensa airport to China, India, Japan, South Korea, the Americas and Africa.
The airline has a fleet of 179 aircraft in total.
Miro Radici Finance is the holding company of the Miro Radici Family of Companies, which operates in areas as diverse as rugs and automotive systems.