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Etihad and Alitalia officials with the award

Etihad receives recognition for equity investment in Alitalia

ABU DHABI, June 9, 2015

Etihad Airways, the national airline of the UAE, was awarded the Airfinance Journal ‘Merger and Acquisition Deal of the Year’ at a recent ceremony in Miami, Florida (US).

The accolade was presented in recognition of Etihad Airways’ acquisition of a strategic minority equity stake in Alitalia, the national carrier of Italy in 2014.

James Hogan, president and chief executive officer of Etihad Airways, said: “We are delighted and honoured to receive this award. It is an endorsement not only of this transaction, but of our business model, which leverages partnership and economies of scale for network growth and to create business synergies across the broad spectrum of airline activities.”  

As part of the restructuring deal valued in total at more than €1.75 billion ($1.95 billion), Etihad Airways invested €560 million ($624.9 million) to acquire a 49 per cent shareholding in New Alitalia, 75 per cent of its frequent flyer programme and asset purchases to restructure the airline’s balance sheet.

This was complemented by a further equity investment of €300 million ($334.8 million) from existing core Alitalia shareholders, including Intesa San Paolo, Poste Italiane , UniCredit, Atlantia, IMMSI, Pirelli and Gavio.
 
The transaction also made provision for up to €598 million ($667.4) in financial restructuring of short and medium term debt provided by financial institutions and existing bank shareholders, and €300 million ($334.8 million) of new loan facilities extended by Italian financial institutions.

“This is a strategic, long-term commercial investment for us and we are committed, with the other shareholders, to support the new management team to reinvigorate Alitalia as a competitive, sustainable and profitable business that can operate successfully in the global air travel market,” Hogan said.

A strategic development plan to deliver profitability by 2017 has since been unveiled, with an unequivocal commitment by the new executive team and strategic investors to reinvent the airline as a premium global airline representing the best of Italy, with new routes, new product and service standards, new branding, and a new cost management strategy. – TradeArabia News Service




Tags: Etihad | investment | equity | merger | Alitalia |

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