Italy mulls 75 million euro stake in Alitalia capital hike: sources

ROME Thu Oct 10, 2013 11:43am EDT

An Alitalia plane prepares to land at Linate airport in Milan October 10, 2013. REUTERS/Alessandro Garofalo

An Alitalia plane prepares to land at Linate airport in Milan October 10, 2013.

Credit: Reuters/Alessandro Garofalo

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ROME (Reuters) - The Italian government is considering joining Alitalia's planned 300 million euro ($406 million) capital increase with a 75 million euro stake issued through the national post office, Poste Italiane, sources close to the situation said on Thursday.

The government would also offer credit guarantees worth a further 75 million euros under the plan, which officials aim to wrap up on Thursday evening for presentation to an Alitalia board meeting on Friday, the sources said.

The plan would see the remaining 150 million euros in the capital hike subscribed by existing shareholders with a further 200 million line of credit authorized by banks, they said.

They said the government had made its participation in the capital increase conditional on a change in management at the troubled airline.

"It's a bridging solution to guarantee the financial survival of the company but it depends on a strong change in the way the company is run," one of the sources said.

(Reporting by Valentina Consiglio, writing by James Mackenzie, editing by Agnieszka Flak)

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