Etihad Airways has confirmed that it has agreed to buy a 49 per cent stake in Italian airline Alitalia.
Etihad, which also owns nearly 5 per cent of Aer Lingus, is Abu Dhabi's state owned airline. This deal may be Alitalia's last chance to turn its fortunes around, as it has been loss-making for a number of years.
The board of Alitalia recently voted to accept an offer by Etihad to invest but did not elaborate further. This deal was a long time in the making, as the struggling airline was reluctant to agree to the job cuts and debt restructuring that Etihad orginally suggested. The fact that Alitalia is due to run out of cash in August is likely to have expedited the deal.
Subject to regulatory approval, the deal will be finalised as soon as possible. Etihad will pay around €400 million for the stake and are expected to invest around a further €560 million and create a company for Alitalia's operating assets. However no clear statement has been made on the matter by either side.
Etihad operates several popular flights to and from Dublin and employs nearly 100 people here, with many more Irish people employed throughout the company. This latest acquisition is the latest in a long line of global alliances, which will allow them to develop a wider network and direct more traffic through their hub in Abu Dhabi.
