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PM aide meets consortium as Alitalia hopes revived

Wed Sep 24, 2008 6:20am EDT

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By Stephen Brown

ROME, Sept 24 (Reuters) - Prime Minister Silvio Berlusconi's right-hand man met on Wednesday the consortium whose offer for Alitalia AZPIa.MI was withdrawn, as the media speculated the premier could pull off a last-minute deal to save the airline.

With the Thursday deadline looming for Alitalia to present a new rescue plan, or lose its operating licence next week and see more than 19,000 workers sacked, Berlusconi cancelled a visit to the U.N. General Assembly in New York to attend to the crisis.

The Italian media reported revived interest from Lufthansa (LHAG.DE) -- despite its repeated insistence that it was not interested in a direct acquisition unless Alitalia's problems were resolved -- and, unexpectedly, from Venezuelan airline Aserca.

Corriere della Sera said the Venezuelans -- "with the help of the socialist government" of Hugo Chavez -- wanted to take part in the new auction and "resolve a good part of the problems affecting Alitalia and all of its workers at the moment".

It is unclear how conservative leader Berlusconi would deal with such an offer.

Cabinet ministers, who had been gloomily saying there was little chance of a reprieve for the CAI consortium's offer due to union opposition, and that no buyers had emerged from among major foreign airlines, began to sound more upbeat.

"It's too much to talk about optimism, but you could say hopes have been revived," Transport Minister Altero Matteoli said, after Berlusconi's most senior cabinet aide, Gianni Letta, met the president and the chief executive of CAI for an hour.

The head of Italy's biggest union, the CIGL, which rejected CAI's conditions of 3,250 job cuts and downgrades in contracts, as did pilots and cabin crew, also said there was a possibility of renewed talks.

"If we sort out the things that were done badly in the rush, and pay attention not to the strongest but the weakest, a step forward could be taken," CIGL boss Guglielmo Epifani told local television, talking of "decisive hours" for Alitalia's future.

ITALY NEEDS FLAG CARRIER

Berlusconi warned this weekend no foreign buyers were coming forward and Alitalia may go bankrupt. He has ruled out modifying CAI's offer and says it is unions who have to cede.

But he appeared to change his tune late on Tuesday when he said: "I remain convinced that we must find a solution so that Italy continues to have its own flag carrier."

Berlusconi returned to power in May promising to rescue the airline, which has not made a profit since 1999 and loses about 2 million euros a day. The media mogul rallied local investors behind a rescue bid but this was withdrawn last Thursday.

In a final attempt at finding a buyer, government-appointed special administrator Augusto Fantozzi published on Tuesday an invitation for offers for all or part of Alitalia by Sept. 30.

His attempts at arousing interest from airlines like Air France, Lufthansa and British Airways (BAY.L) appear to have come to nothing, though there has been interest in buying or leasing aircraft and taking over, but not necessarily buying, slots.

British budget carrier easyJet (EZJ.L) said it could take over some domestic routes and one paper said Air France-KLM (AIRF.PA) and Lufthansa want slots on the Rome-Milan route.

Alitalia has stuck to flight schedules despite the prospect of being grounded. Many domestic travellers have little choice but to fly Alitalia, but it is also a source of national pride.

A tender for the state's 49.9 percent stake by the previous centre-left government attracted 11 bidders who all pulled out.

A second attempt led to Air France-KLM being picked as buyer but the deal met opposition from unions and Berlusconi, who was campaigning for office and said Alitalia must stay Italian.



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