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Etihad chief regrets Alitalia staff vote to reject plan

Etihad chief regrets Alitalia staff vote to reject plan

Italian flag carrier Alitalia could be heading toward bankruptcy after its employees rejected a plan Monday that was created to bring the carrier back to profitability, but also would have cut salaries and jobs.

Following the vote, Alitalia's board has called a shareholders meeting for April 27 to discuss the two options now on the table: Either that the carrier prepares to be wound up or that it enters special administration proceedings. The airline secured much-needed investment when Etihad acquired a 49% stake in the airline and relaunched it in 2015 with a view to returning Alitalia to profit this year.

In view of such cuts, it would have unlocked 2 billion euros (2.18 billion USA dollars) of capital increase, including more than 900 million of fresh resources, according to Alitalia. Among other measures, the plan included salary reductions and hundreds of job cuts.

The latest draft of the restructuring plan involves eliminating 1,700 jobs from a global headcount of 12,500 and wage cuts of up to eight percent for some of the remaining staff.

In a separate statement the airline says despite the rejection of the deal, Alitalia maintains its schedule and its operations will not be altered at this time.

Etihad and the Italian banks Intesa Sanpaolo and UniCredit have said they would only inject new funds if the unions agree to the new collective labor agreement and cuts. In 2014, the Abu Dhabi-based company vowed to help boost the value of the Italian airline and promised to make it profitable again by 2017.




"Alitalia's shareholders, including Etihad Airways, have provided vast amounts of financial and commercial support during the past three years.", Hogan said.

The company's board on Tuesday asked the government to appoint administrators to find a purchaser or organise the winding up of the company. Jointly with the Italian shareholders, Etihad had reaffirmed its strong commitment and principal willingness to support the airline with a package worth almost €2 billion in aggregate to help fund Alitalia's new five-year business plan.

"A key condition to this commitment was that an agreed and concerted effort would be made by all interested parties, including the unions".

"At this stage, waiting to know the decisions of Alitalia's current shareholders, the goal of the government is to minimize costs for Italian citizens and for passengers", the ministers added.

"I felt disappointed for the opportunity that was provided by the agreement, and was not sized", La Repubblica newspaper cited Gentiloni as saying. UniCredit SpA said last week that the bank has lost nearly 500 million euros on the Italian carrier.

Workers had repeatedly said they were unwilling to accept any further sacrifices when Alitalia's labour costs were already among the lowest among the legacy airlines in Europe.

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