Another Day, Another Rumored Alitalia Buyout
Vidya Ram, 09.27.07, 12:25 PM ET
Investors are sick to death of all the speculation about which firm could buy Alitalia, the beleaguered Italian airline. Even a report that cash-rich Emirates airline is interested in taking a stake failed to get the market's pulse racing.
On Thursday the Italian daily newspaper MF reported that Emirates, the largest airline in the Middle East, was considering acquiring a 5.0% stake in Alitalia (other-otc: ALAIF - news - people ), which the Italian government is attempting to privatize. Emirates is considering joining a group that could make a bid for the carrier, led by Antonio Baldassare, a high profile Italian lawyer, reported the paper.
Dubai-based Emirates is part of the larger Emirates Group, which also owns a chain of hotels, and a travel agency.
As the attempt by the government to sell up to a 49% stake in the company has so far proved rather disastrous and protracted, the news had no impact on investor confidence in the company.
A spokesman for Emirates eventually denied that the company was interested in Alitalia. "Emirates currently has no intention of buying a stake in Alitalia. Our business strategy is to grow organically," he said.
Alitalia remained flat at 82 euro cents ($1.16) in early afternoon trading in Milan, even before Emirates' denial.
The attempted sale of the beleaguered state-controlled airline began last year, through a public auction. The auction attracted companies such as Russia's Aeroflot, AP Holdings, the owner of Italy's Air One airline and investment firms such as Matlin Patterson Global Advisers, the Texas Pacific Group and Italian bank Mediobanca (other-otc: MDIBF - news - people ). But in the end the unattractive conditions, including a massive debt and restrictions on how the company could be structured, left the government without a single binding bid. (See: " Alitalia Sale Stalls")
Alitalia has drafted a new Chairman, Maurizio Prato, to oversee the sale. So far while there has been plenty of talk about potential bidders, including a return by Air One and Aeroflot, (other-otc: AERUF - news - people ), Air France-KLM (nyse: AKH - news - people ), Deutsche Lufthansa (other-otc: DLAKF - news - people ) and now Emirates, nothing concrete has emerged. Meanwhile, Alitalia continues to make losses. (See: " Market Scoffs At Alitalia Results")
Prato now says a short list of potential buyers will be put to the board by October 10. But with no clear endgame in sight the Alitalia's future remains precarious. |
