Italy: Alitalia board backs capital increase [Adnkronos International, Rome]
(Adnkronos International (Rome, Italy) Via Acquire Media NewsEdge) Sept. 27--Troubled airline Alitalia has backed a capital increase of at least euro100m to keep it afloat as it continues to seek a foreign takeover.
The company's board on Thursday set a shareholders' meeting for 14 October to approve the planned capital increase.
Alitalia sustained 294 million euros of losses in the first half of this year, up from 201 million euros in the same period of 2012, its board reported during a drawn-out meeting in Rome on Thursday.
Net debt at the end of June was 946 million euros, down from 1 billion at the end of March and the company had liquidity of 128m euros, Alitalia's board said.
Air France-KLM, is Alitalia's largest shareholder with a 25 percent stake, and Italy's transport minister Maurizio Lupi met French officials in Paris to discuss boosting the Franco-Dutch group's holding acquired in 2009 and a possible takeover deal.
Since being taken over by a private consortium of Italian investors in early 2009, Alitalia has accumulated net losses of more than 840 million euros and is rapidly running out of cash.
An ambitious plan to become a strong regional player failed in the face of aggressive competition from low-cost carriers and from high-speed trains on Alitalia's once-lucrative Milan-Rome route.
The struggling airline's new CEO, turnaround specialist Gabriele Del Torchio, has already outlined a new plan centred on the more lucrative long-haul market, but urgently needs to raise cash to purchase the larger aircraft needed for inter-continental flights.
Air France-KLM tried to take over Alitalia in 2009, but the deal was scuppered by Italy's prime minister at that time, Silvio Berlusconi, who asked 21 Italian investors to rescue the airline from bankruptcy.
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