Italian airline could lose its license - ResearchInChina
Date:2008-04-23
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ITALIAN aviation authorities warned yesterday that they could revoke Alitalia's license if it could not meet its obligations, including safety guarantees, after Air France-KLM abandoned an offer that might have saved the airline.
Trading in Alitalia shares has been suspended on the Milan stock exchange as authorities await a statement from the airline.
Under European rules, for an airline to have a license "they have to see that there's continuity, among other things, for safety," Vito Riggio, chairman of Italy's civil aviation agency ENAC said. "They have to guarantee they have (financial) coverage for at least a year."
Riggio said ENAC could either revoke Alitalia's license or give it a provisional one if the airline could not save itself financially.
Alitalia is running out of time. Losing some US$1.6 million a day, the airline is lurching toward possible bankruptcy protection that could force it to lay off thousands of employees and eliminate unprofitable routes.
Italy's outgoing government is expected to convene a special Cabinet meeting soon to try to save Alitalia, possibly with a loan to help it pay its bills. The state owns 49 percent of the flagship carrier, and has been trying to unload the loss-maker for months.
Air France-KLM said on Monday that its US$220 million offer to buy Italia was no longer valid.
Media magnate Silvio Berlusconi, who won elections last week for the premiership, had lobbied against the offer and promised during his campaign that Italian businessmen would come forward to rescue Alitalia. But no Italian deal has emerged.
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