Alitalia may push back capital increase deadline: source

13th November 2013, Comments 0 comments

Embattled Italian airline Alitalia may push back the deadline for subscription to a capital increase to buy time for negotiations with its major shareholder Air France-KLM, a source said Wednesday.

The company's board, meeting later Wednesday, is expected to push back the deadline originally set for Thursday by up to 10 days "to have more time", a source close to the company said. Alitalia was not available for comment.

The board will meet at 1800 GMT to examine a new strategic plan which could include some 2,000 job cuts.

Air France-KLM, which owns 25 percent of Alitalia, has yet to announce whether it will take part in a 300-million-euro ($400-million) recapitalisation plan to save the Italian airline which is debt to the tune of 1.2 billion euros ($1.6 billion).

Alitalia was already bailed out by taxpayers five years ago in a controversial operation that handed a consortium of private Italian companies a majority stake, part of which was later sold to Air France-KLM.

The still-struggling Italian airline is again flirting with bankruptcy, prompting the hasty recapitalisation plan. Italian energy group ENI has threatened to ground its fleet of planes by stopping fuel supplies because of unpaid debts.

Alitalia says Italian banks are lined up to lend it 200 million euros. And the state-owned Italian postal service has been tapped to contribute up to 75 million euros, triggering rivals' allegations of illegal protectionism.

© 2013 AFP

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