Delta continutes to pursue bankrupt Alitalia’s takeover

Bloomberg

Delta Air Lines Inc will continue to pursue a takeover of Alitalia SpA’s operations after a potential partner dropped out, leaving the Italian government with only one industry suitor willing to take the unprofitable flag carrier off its hands.
The US airline said it was continuing discussions with state-controlled railway Ferrovie dello Stato Italiane SpA about taking a stake in Alitalia even after the UK’s EasyJet Plc formally withdrew on Monday. Delta is studying an investment of $113 million, newspaper Corriere della Sera said.
“Delta confirms that it continues to explore ways to work with Ferrovie dello Stato and maintain our partnership with Alitalia in the future,” the Atlanta-based airline said in an email without providing additional details. It called Alitalia “a longstanding partner.”
A deal with Alitalia would bolster Delta’s roster of international holdings, which the US carrier has used aggressively to expand its global footprint.
Delta owns 49 percent of Virgin Atlantic Airways Ltd. and Grupo Aeromexico SAB, along with smaller stakes in Air France-KLM, Brazil’s Gol Linhas Aereas Inteligentes SA and China Eastern Airlines.
At Alitalia, Delta would take a 10 percent stake, which would double within four years if certain business goals are met, according to Il Messaggero.
The current options for a turnaround of Alitalia aren’t right for EasyJet, said a spokeswoman for the discount carrier. She declined further comment.
Should the Delta talks founder, the only other alternative besides liquidation is to give a rescue role to Deutsche Lufthansa AG.
The German carrier has signalled that it’s interested, but only if the government first cuts back on headcount. Lufthansa wants to keep no more than 60 percent of Alitalia’s workforce, people familiar with the matter said last week.