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EasyJet Plc, Air France-KLM Group and Cerberus Capital Management LP have made a joint approach to the Italian airline Alitalia SpA about a possible takeover, according to a person familiar with the matter, betting the unprofitable carrier will provide a gateway to expansion in the Mediterranean market.
EasyJet, Europe’s second-biggest low-cost airline, said Tuesday it has submitted a “revised expression of interest for a restructured Alitalia” as part of a consortium, without naming the other members. The French carrier and the private equity firm are working with the Luton, England-based airline, said the person, who asked not to be identified.
A spokesman for Air France declined to comment while a representative of Cerberus could not provide immediate comment. Deutsche Lufthansa AG submitted a separate offer, Ansa reported, without saying where it got the information. Alitalia said separately that it has received three offers.
The approaches are part of a government-led search for a partner for Alitalia, which is on state support and in need of a rescuer. The carrier was declared insolvent nearly a year ago and has been in talks with a number of foreign investors interested in acquiring parts of its business. Italy has pumped 900 million euros ($1.1 billion) into the airline through bridge loans during the past year to keep it afloat. This is the second time in a decade that Alitalia has sought to attract an international partner after filing for bankruptcy.
“There is no certainty at this stage that any transaction will proceed and EasyJet will provide a further update in due course if and when appropriate,” the U.K. company said.
A takeover of Alitalia would come on top of EasyJet’s successful bid for defunct Air Berlin’s operations at Berlin Tegel Airport. With that acquisition, the carrier’s fleet will surpass 300 single-aisle Airbus SE aircraft and the number of passengers is expected to rise to 90 million in 2018.
Lufthansa last year expressed interest in portions of Alitalia, saying it would preserve the Italian rival’s long-term economic prospects. Like EasyJet, it didn’t disclose financial details of its offer, citing a confidentiality agreement. Ryanair Holdings Plc pulled out of the bidding process last year, saying it needed to focus on fixing the fallout from the staffing shortage.
Italy’s political uncertainty means additional financial assistance for Alitalia may not be forthcoming. The country is in the process of trying to form a coalition government after March 4 general elections resulted in a hung parliament with no party having enough votes to govern. President Sergio Mattarella is holding talks with parties this week to try to find an accord.
In 2014 Eithad Airways PJSC, the Abu Dhabi-based airline, took a 49 percent stake in Alitalia with plans to cut costs and focus on longer international routes from Rome and Milan. Those plans faltered as Alitalia went bankrupt.
–With assistance from Manuel Baigorri
©2018 Bloomberg L.P.
This article was written by Tara Patel, Alessandra Migliaccio and Benjamin Katz from Bloomberg and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to email@example.com.