Monday 25 September 2017

Ryanair will keep Alitalia long-haul fleet if bid a success

An Alitalia plane prepares to take off from Linate Airport, Milan, Italy
An Alitalia plane prepares to take off from Linate Airport, Milan, Italy
Ryanair CEO Michael O'Leary
John Mulligan

John Mulligan

Ryanair boss Michael O'Leary has confirmed his intention to submit a binding bid for Alitalia - including its long-haul operations - in what would be a significant strategic shift for the carrier.

The bids are due to be submitted by October 2.

Mr O'Leary said yesterday that if Ryanair is successful in its bid, it would retain the Alitalia brand, its long-haul operations, but change the ownership structure of the Italian carrier's short-haul fleet, which is currently leased. Ryanair operates an almost entirely owned fleet of Boeing 737 aircraft.

Ryanair is one of about 10 airlines and groups that in July submitted non-binding agreements to Alitalia's administrator to buy the ailing carrier, or parts of it.

Other bidders include EasyJet, Aer Lingus owner IAG, Delta and Air France.

Alitalia collapsed into administration in May, with the Italian government giving it a €400m loan to enable it to continue trading as the administrator decides to sell the airline or liquidate it.

At the time it had submitted its non-binding agreement, Ryanair chief financial officer Neil Sorahan told the Irish Independent that Alitalia would need to be "radically overhauled" before the Irish carrier would get involved with it.

Speaking in Berlin yesterday, Mr O'Leary confirmed that Ryanair was planning on retaining Alitalia's long-haul business and the airline brand.

He added that Ryanair hoped to preserve jobs for pilots and crew, but warned they would have to be on new terms in line with Ryanair's cost base.

Two weeks ago, Mr O'Leary said that if successful in its bid, Ryanair would operate 90 Alitalia jets under the Italian airline's livery.

"I think one of the aspects of Alitalia that is really attractive is the long-haul fleet. There is the capacity to grow very strongly," he said at the time.

Ryanair wouldn't be able to take control of all of Alitalia because it would certainly be blocked on competition grounds.

Ryanair was recently thwarted in efforts to get involved in the carve-up of failed carrier Air Berlin. (Additional reporting: Reuters)

Irish Independent

Also in Business