Alitalia risks bankruptcy without capital increase
Airline needs €500 million to stay in business and invest in turnaround strategy
An Alitalia aircraft approaches to land in Rome. The loss-making Italian airline risks having to file for bankruptcy if no deal on a proposed capital increase is reached in a couple of weeks. Photograph: Reuters/Max Rossi
Loss-making Italian airline Alitalia risks having to file for bankruptcy if it fails to agree a deal for a capital increase in the next couple of weeks, a government source said yesterday.
Alitalia needs about €500 million to stay in business and invest in a turnaround strategy, analysts have said, after accumulating losses of more than €1 billion and debt of a similar size since being rescued from bankruptcy in 2009.
Its shareholders, 21 Italian investors including bank Intesa Sanpaolo and road operator Atlantia, will vote on a capital increase of €100 million next Monday to keep the business running as it seeks fresh bank financing and a longer-term solution to its financial plight.
The airline has also fallen behind in its payments for fuel, suppliers have said, and could face the prospect of having to ground its fleet. – (Reuters)