ROME: April 27, 2016. Alitalia is to conduct due diligence with a view to purchasing a 49 percent stake in Air Malta following the signing of an MoU with the airline and the Maltese government.
In June 2012 the European Commission approved a restructuring plan for the airline with the aim of turning a €78 million loss in 2011 into a breakeven by 2015.
Last year Air Malta lost €16.4 million on revenue of €218.2 million - down from €234.2 million in 2014 - due to what it says were EU-imposed sanctions on Russia and the termination of flights to Libya.
Once the due diligence is complete the Boards of Alitalia and Air Malta will make a decision on whether to proceed with an offer, according to a statement.
Alitalia’s CEO Cramer Ball commented: “There are strong cultural and commercial bonds between Italy and Malta, and this MOU is a first and important step, but we will only make a decision once we have completed an exhaustive examination of a possible deal. We will need to establish unequivocally that a deal with Air Malta (picture: IAC Aero) will not undermine the progress of our three year turnaround programme, or prejudice our financial position. Until then, it’s business as usual.
“We are on track to become a profitable entity by 2017 and we need to look and plan for the future, which is why we have decided to look closely to see whether Air Malta can fit into our strategic growth, particularly how our networks can complement each other in areas such as southern Italy. The future of the commercial aviation industry has to be one of consolidation, and for us to prosper we must examine opportunities where we believe we can offer a wider reach for our customers,” he noted.
Malta minister of Tourism Zammit Lewis said his government would now cease discussions with other airlines, adding: “This is one step of the process and there is still a long way to go.”
Earlier this month Alitalia announced it would begin non-stop services between Rome and Beijing in July following new service to Santiago, Chile in May and Mexico City in June.