Alitalia woes

The future of Alitalia is far from secure with Air France (AF) now having second thoughts over future investment and International Airlines Group (IAG), the combined British Airways and Iberia, saying that the fresh capital injection is illegal. (See last week’s BTN)

IAG, Europe's third biggest airline group by market value, said that the rescue breaks European Union rules. "We have always been opposed to state aid", said a spokeswoman.  "It's protectionist, undermines competition and favours failing airlines that have not got to grips with economic reality".

"We would urge and expect the EU Commission to take interim measures to suspend this manifestly illegal aid", she added.

In Brussels the Commission says it waits to hear from Rome.  "Only after receiving the notification will we be able to assess its compatibility with EU state aid rules", said Antoine Colombani, EU Commission spokesman for competition policy.

AF is the largest of 21 shareholders, all of whom have a verbal, if not voting, share of the airline.  From a strategic point of view its continued lead interest is vital for Alitalia’s future. www.alitalia.com

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