Italian investors submit Alitalia bid

A group of Italian investors have formally submitted a bid a to purchase Alitalia, the bankrupt Italian national airline. A consortium of investors has reportedly offered €400 million to buy up some of the more successful branches and units associated with Alitalia’s business. Although Prime Minister Silvio Berlusconi’s conservative government is almost certain to welcome this bid-especially considering that authorities have tried in vain to privatize the badly indebted airline for well over a year-a number of obstacle remain and any number of them could spell trouble for the proposal.

According to a Financial Times report, the bid will only be valid for two to three weeks, and investors require guarantees from labour unions representing Alitalia workers that they will not oppose massive job cuts that are seen as necessary for the carrier to restructure and move towards profitability. The unions have given few clues as to how they will react, but the fact that their unwavering opposition to Air France-KLM’s proposed bid helped nix the government’s original privatization plans might give cause for concern. This time, however, the Italian government is trying hard to appease union workers and make the inevitable job cuts much more palatable. One of the options is to provide redundant Alitalia employees with new jobs within the public sector.

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