'Crunch time' arriving for Alitalia

(ANSA) - Rome, July 29 - Crunch time is coming in negotiations to finalize a 560-million-euro deal that would see Abu Dhabi-based Etihad Airways buy a 49% stake in struggling Italian carrier Alitalia, Transport Minister Maurizio Lupi warned Tuesday.
    His comments came as a critical agreement was reached with stakeholder banks that will see Italy's State postal company Poste Italiane invest 65 million euros in Alitalia, a major step towards completing the life-saving Etihad deal, sources said Tuesday.
    "We have now reached the decisive hours: Etihad has raised very clear issues to which the board of directors of Alitalia has made a clear response," said Lupi.
    "Now, it is necessary to translate those answers into very concrete facts," he said.
    A crucial measure came with the deal involving Poste Italiane, currently one of Alitalia's biggest stakeholders after it acquired over 19% of the airline as part of a government-orchestrated bailout last year.
    It had previously balked at any further investments in Alitalia without guarantees that it would not be on the hook for the airline's enormous debts, estimated by some at more than 800 million euros.
    Sources said a solution was developed that will involve a kind of middle company that Poste Italiane said allows it to make an investment "that is consistent with, and meets the industrial logic of, Poste Italiane as a public company".
    Alitalia shareholders agreed last Friday to raise some 250 million euros among themselves in order to keep the carrier flying until the Etihad deal is finalized.
    State-owned Etihad is poised to finalize the deal but has demanded certain conditions involving reorganization of Alitalia's debt as well as significant labour cuts.
    In a note Tuesday, Etihad said that work was progressing on "outstanding issues related to a possible investment in Alitalia". Etihad has been pressing for a deal by the end of the month but unions representing Alitalia employees remain divided over the labour cuts, which include both reductions in wages and other costs, as well as outright job cuts.
    Lupi has warned unions to accept the conditions in order to keep Alitalia alive.
    "The alternative is very clear and everyone should know that," said Lupi.
    "There are no other options...everyone must shoulder their part of responsibility," Lupi concluded.