Tuesday, September 16, 2008

Alitalia Looks to Lufthansa

Alitalia is still in trouble. Rumor has it that they are looking to Lufthansa, the German airline, for a partial buyout (the Italian government owns almost half of the airline and it cannot sell). Air France-KLM was blocked by unions from a buyout earlier this year, so it's hard to predict what will happen. Lufthansa thinks that Alitalia has too much debt. In the meantime, Alitalia is losing money every day, is cutting thousands of jobs, and has trouble buying fuel. It hasn't cancelled any flights yet...but be aware when booking Alitalia that things are precarious. Paolo Scaroni, the chief executive of ENI, an Italian oil company, told La Repubblica that he would not sell oil to Alitalia on credit "not even if Berlusconi or the pope asked me to."

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