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Alitalia loan stirs rescue hopes | |
(about 3 hours later) | |
Italy's next Prime Minister Silvio Berlusconi has said that an emergency loan to Alitalia makes it more likely that the problem airline will be saved. | |
Mr Berlusconi, who is due to take office in about a month, said a group of firms and banks were now expected to put together a rescue package. | |
However, Mr Berlusconi failed to give any details of the firms involved. | |
Alitalia is on the verge of collapse and needed a loan of 300m euros ($475m) on Tuesday in order to keep operating. | |
The funds will keep Alitalia going for a couple of months while Mr Berlusconi examines options for its future. | The funds will keep Alitalia going for a couple of months while Mr Berlusconi examines options for its future. |
He said that the extra time would allow a group of Italian entrepreneurs, aided by banks, professionals and airlines, to study Alitalia's accounts. | |
"After due diligence of three, four or five weeks, this new group will present a binding offer and take over the running of Alitalia, which will involve a painful reduction in personnel," he explained. | |
Talk collapse | |
The latest round of problems at Alitalia were prompted by Air France KLM's decision to drop a takeover bid for the firm after opposition from unions. | |
Alitalia is haemorrhaging cash and it was feared that Air France's withdrawal would force the firm to seek bankruptcy protection. | Alitalia is haemorrhaging cash and it was feared that Air France's withdrawal would force the firm to seek bankruptcy protection. |
Mr Prodi announced the 300m-euro financial support following a cabinet meeting. | |
"Silvio Berlusconi asked me to provide a more considerable bridge loan than the one we had foreseen in order to have time to put together and organise possible alternative solutions to this problem," Mr Prodi said. | "Silvio Berlusconi asked me to provide a more considerable bridge loan than the one we had foreseen in order to have time to put together and organise possible alternative solutions to this problem," Mr Prodi said. |
The loan is likely to be investigated by the European Commission, which has been cracking down on state subsidies for the aviation industry. | The loan is likely to be investigated by the European Commission, which has been cracking down on state subsidies for the aviation industry. |
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