Air Malta Chair­per­son says dis­cus­sions with Al­i­talia on­go­ing, but Ital­ian me­dia claim oth­er­wise

Malta Independent - - FRONT PAGE - Gabriel Schem­bri

Air Malta Chair­per­son Maria Mi­callef yes­ter­day said that the ne­go­ti­a­tions with Ital­ian na­tional air­line Al­i­talia are still on­go­ing. In com­ments to The Malta In­de­pen­dent, Mrs Mi­callef said that the com­pany is keeping all op­por­tu­ni­ties open. “Ne­go­ti­a­tions are still go­ing on and that is all I can say for now,” she said while giv­ing a com­ment at the World Tourism Fair in Lon­don.

Me­dia re­ports in an Ital­ian news­pa­per, how­ever, sug­gest oth­er­wise. In fact, Il Gior­nale re­ported yes­ter­day that the deal be­tween Ital­ian air­line Al­i­talia and Air Malta is off. An ar­ti­cle which was pub­lished yes­ter­day claims that al­though the news has not yet been made of­fi­cial, Al­i­talia will not be ac­quir­ing 49% of the Mal­tese na­tional air­line’s shares.

“It ap­pears that the deal has col­lapsed,” the re­port in Il Gior­nale web­site states.

In a state­ment yes­ter­day evening, the gov­ern­ment said it took note of “the var­i­ous re­ports pub­lished in the me­dia today and of the fact that none of these quote of­fi­cial sources.”

It is on the con­trary con­firmed that talks are still on­go­ing, the gov­ern­ment said.

As previous state­ments have in­di­cated, the gov­ern­ment will keep ad­dress­ing is­sues at Air Malta that had been left pend­ing for years, it con­cluded.

Last April, Al­i­talia and Air Malta signed a mem­o­ran­dum of un­der­stand­ing which was sup­posed to lead to ne­go­ti­a­tions aimed at the sale of 49% of the com­pany’s share. The fi­nal de­ci­sion be­tween the two par­ties was sup­posed be have been taken by the end of Septem­ber.

The news­pa­per quotes ‘Mal­tese sources’ say­ing that Eti­had, par­ent com­pany of Al­i­talia, ‘lost its en­thu­si­asm’ to strike the deal. The ar­ti­cle noted that the Mal­tese gov­ern­ment’s ne­go­ti­a­tions are in­flu­enced by the up­com­ing gen­eral elec­tions. It says that in this re­gard, the Mal­tese gov­ern­ment does not want to take un­pop­u­lar de­ci­sions.

Ne­go­ti­a­tions with the EU Com­mis­sion in 2011 al­lowed a state sub­sidy to Air Malta of €130 mil­lion and it was agreed that by 2014 Air Malta had to bal­ance its bud­get, and reg­is­ter a profit by March 2016. This has not been achieved.

Af­ter this pe­riod, un­der EU state-aid rules which safe­guard fair com­pe­ti­tion within the EU’s in­ter­nal mar­ket, the only in­jec­tion of cash al­lowed would have to come from pri­vate sources.

Air Malta reg­is­tered losses of €4 mil­lion for the fi­nan­cial yearend March 2016, sig­nif­i­cantly lower than the nearly €17 mil­lion loss reg­is­tered a year ear­lier. The EU Com­mis­sion did not im­pose any penal­ties in view of the progress made be­tween 2015 and 2016.

Ear­lier this year the gov­ern­ment said that it spent months of ne­go­ti­a­tions with var­i­ous air­lines in order to ac­quire a strate­gic part­ner which would buy a minority stake and in­ject some much needed funds into Malta’s na­tional air­line – re­sult­ing in the MoU with Italy’s na­tional car­rier, Al­i­talia.

In Oc­to­ber, it had been re­ported that the gov­ern­ment was likely to pull the plug on the talks be­tween the two air­lines.

Ear­lier this year, The Malta In­de­pen­dent had re­ported how Al­i­talia reg­is­tered a loss of more than €200 mil­lion for the year 2015. More­over, the com­pany which is 49% owned by Eti­had, is ex­pected to lose al­most another €100 mil­lion by end of this year.

Air Malta reg­is­tered losses of €4 mil­lion for the fi­nan­cial year-end March 2016

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