EU rules warning on Alitalia deal

EU rules warning on Alitalia deal

The rescue deal for the Italian airline Alitalia must not breach European Union competition rules, the carrier’s bankruptcy administrator has been warned.

An investment group, the Compagnia Aerea Italiana (CAI), made an offer of £789 million (1bn euros) on Friday, despite the lack of agreement with some unions.

About 3,000 workers will lose their jobs under the rescue plan. The CAI hopes to link Alitalia with a major European airline, but a decision is not expected for several weeks.

Air France-KLM, Lufhansa and British Airways have all been courted as possible partners for Alitalia.

The rescue offer from the CAI came after lengthy talks with Alitalia’s trade unions, which broke down on several occasions.

Alitalia’s bankruptcy administrator, Augusto Fantozzi will study the offer this week, but has said any deal must not violate EU competition rules.

The unions had accepted the CAI’s takeover of Alitalia in principle but the airline’s pilot and flight staff unions have not agreed to the CAI’s detailed terms.

Without a binding rescue offer, Alitalia would have been forced to seek new funding within weeks to keep itself going or risk bankruptcy.EU rules warning on Alitalia deal

The rescue deal for the Italian airline Alitalia must not breach European Union competition rules, the carrier’s bankruptcy administrator has been warned.

An investment group, the Compagnia Aerea Italiana (CAI), made an offer of £789 million (1bn euros) on Friday, despite the lack of agreement with some unions.

About 3,000 workers will lose their jobs under the rescue plan. The CAI hopes to link Alitalia with a major European airline, but a decision is not expected for several weeks.

Air France-KLM, Lufhansa and British Airways have all been courted as possible partners for Alitalia.

The rescue offer from the CAI came after lengthy talks with Alitalia’s trade unions, which broke down on several occasions.

Alitalia’s bankruptcy administrator, Augusto Fantozzi will study the offer this week, but has said any deal must not violate EU competition rules.

The unions had accepted the CAI’s takeover of Alitalia in principle but the airline’s pilot and flight staff unions have not agreed to the CAI’s detailed terms.

Without a binding rescue offer, Alitalia would have been forced to seek new funding within weeks to keep itself going or risk bankruptcy.

BMI being taken over by Lufthansa

BMI being taken over by Lufthansa

BMI is being taken over by Germany’s Lufthansa.

Lufthansa, which already owns a 30 per cent stake in BMI minus one share, is buying the 50 per cent of the company owned by BMI chairman Sir Michael Bishop.

The deal will give Lufthansa control of more flights from Heathrow than any airline except British Airways.

The remaining 20 per cent of BMI is currently owned by Sweden-based Scandinavian Airlines (SAS).

Lufthansa said it intended to complete the deal by 16 January. Earlier this year it bought a 45 per cent stake in Brussels Airlines.

Lufthansa issues profit warning

Lufthansa issues profit warning

Lufthansa has followed the lead of Air France-KLM by issuing a profits warning.

The German carrier lowered its 2008 operating profit outlook due to higher fuel costs and an uncertain market amid the global economic slowdown and financial crisis.

The company said it now expects operating profit for the year to come in at 1.1 billion euros (£800 million).

The profit warning comes three weeks after Lufthansa for the first time conceded that the financial crisis and cooling global economy have led to a noticeable decline in bookings, particularly from business travellers.

Commerzbank analyst Frank Skopzik said: “We’ve expected a profit warning in our estimates but are surprised how weak third quarter figures came in.”

Lufthansa said net profit for the first nine months of the year fell more than 65 per cent.