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Bidder withdrawal leaves Alitalia auction in tatters


Bidder withdrawal leaves Alitalia auction in tatters


Italy’s government is trying to avoid the collapse of the sale of flag carrier Alitalia after the last credible prospective bidder pulled out of the auction for the loss-making airline.

The front runner, Italian budget airline Air One, withdrew saying it cannot accept restrictions placed on the sale, including limits on job cuts. But union leader Raffaele Bonanni believes that is just a ploy to avoid paying full price. He said: “It’s a scandal. The government’s worrying about the sale process, but Alitalia is going to be sold to people who just want to pay as little as possible.”

In response to Air One’s withdrawal, Alitalia’s shares dropped at one stage as much as 10% to 72 euro cents. That made the airline’s stock worth just one billion euros. At their highest – in 1998 – the shares reached 22.5 euros.

Founded 60 years ago, Alitalia’s glory days are long behind it and the company’s future looks bleak, which is bad news for the centre-left government of Prime Minister Romano Prodi. Rome insisted the privatisation plan will proceed but admits it may need a new strategy. Air One has said it might get back into the auction but only if the sale conditions are changed.

Meanwhile scores of Alitalia flights were grounded on Tuesday as a union called the latest in a series of one-day strikes in protest against possible future job cuts.

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