Delta and EasyJet confirmed on Wednesday that they had joined hands with Italy’s state-backed railway company Ferrovie dello Stato to explore a bid to take over the country’s troubled national carrier Alitalia.
A sale of Alitalia, which was placed into administration in 2017 after a string of restructurings and investments over the past decade had failed to shift the Italian flag carrier’s fortunes, has been years in the making and drawn a handful of interested bidders.
Ferrovie dello Stato said that it would begin negotiations with Delta and EasyJet to agree a plan for Alitalia. Delta and EasyJet confirmed that talks with the state-backed rail company were ongoing. EasyJet cautioned that there was “no certainty” it would proceed with a transaction to buy a stake in Alitalia.
To secure a deal EasyJet and Delta would need to convince the Italian government that they are the best partners to stabilise Alitalia, which has suffered large financial losses and has struggled to compete with low cost rivals.
Italian news media reported on Wednesday that the country’s rightwing populist coalition government would be inclined to back a deal with Delta and EasyJet, as long as Ferrovie dello Stato retained a majority stake in Alitalia.
The sale and restructuring of Alitalia had earlier been delayed by the change in government in Rome. The new populist leadership has made it clear to prospective bidders that any offer should include a domestic group owning a majority stake in Alitalia.
“The government is willing to participate in the creation of a New Alitalia, through the economy ministry, on the condition that this is in line with European rules and that there is a sustainable business plan in place,” prime minister Giuseppe Conte’s office said in a statement. Mr Conte had earlier on Wednesday met with his deputy Luigi Di Maio and economic minister Giovanni Tria to discuss a rescue plan for Alitalia.
The lossmaking carrier has been circled by suitors before, and had earlier counted Gulf carrier Etihad as a minority shareholder before its collapse in 2017. International airlines Lufthansa and Air France-KLM, as well as private equity group Cerberus Capital Management, had all previously approached Alitalia.
Lufthansa has said it is only interested in acquiring Alitalia if the airline conducts a round of extensive job cuts while in administration. The German carrier also has made its offer conditional on getting full control of Alitalia, without government ownership. Air France-KLM was not expected to renew its interest in the carrier in the latest round of bidding, the FT reported last year.
Get alerts on Airlines when a new story is published