Alitalia is cancelling 100 flights a day for the rest of the month due to ongoing strikes by pilots and cabin straff. The workers are trying to prevent a takeover which they are arguing would erode their union rights.

But despite strike action now entering a second week and causing widespead chaos to services, the proposed take-over by CAI consortium is ploughing ahead. Last week it overcame the key hurdle of gaining regulatory approval from the European Commission for a Eur 375 million takeover last week. Whilst this week the airline’s bankruptcy commissioner is expected to give the go-ahead.The commissioner must ensure CAI’s offer is not sold below market value. However with no other bidders and cash reserves dwindling fast, he has already hinted the offer will be accepted.

“We’ll wrap up the deal this week,” Augusto Fantozzi told Italian television. “I hope only pleasant surprises remain. By the middle of the week, there will be serenity.”

CAI is offering Eur 275 million for Alitalia’s flight operations and Eur 100 million in a mix of cash and debt for other units, and will take on further debt of Eur 625 million.

Labour Minister Maurizio Sacconi said: “CAI’s project is going ahead inexorably and irreversibly. A small minority can’t stop what’s in the general interest. The protests are, as is reasonable, flaming out because in my opinion, this is a backward-looking battle.”

Meanwhile the soap opera of the beleaguered national carrier took another twist last night after Italian Prime Minister Silvio Berlusconi announced both he and German Chancellor Angela Merkel are in favour of a potential alliance between Alitalia and Lufthansa.

Speaking at a news conference in Trieste, Berlusconi said: “The Chancellor and I are in agreement in looking upon the possibility of an alliance between Alitalia and Lufthansa very favourably. We hope that this can take place.”

According to reports in the Italian media, Air France-KLM is favourite to edge out Lufthansa to acquire a stake in the Italian carrier.
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