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Political wrangling delays launch of renationalised Alitalia - sources

ROME, Sept 29 (Reuters) - Political wrangling over board appointments for the new state-controlled Alitalia is hampering the launch of the airline, two government sources told Reuters.

Italy decided to renationalise Alitalia when the coronavirus increased financial problems for the carrier after 11 difficult years as a private company and three failed restructuring attempts.

The government has picked the Italian post office’s former chief Francesco Caio as chairman and the carrier’s Chief Business Officer Fabio Lazzerini as chief executive.

But the anti-establishment 5-Star Movement and the centre-left Democratic Party are still at loggerheads over the remaining five board names.

“It’s chaos,” said a government source who asked not to be named. Early in September, Transport Minister Paola De Micheli said the new company would be set up within a week.

A second government source said a conflict between ministerial technical bodies had contributed to the delay in the launch of the company, originally scheduled for June.

“Alitalia employees are also an issue,” the second source said, adding that some 4,000 of the more than 11,000 staff members are at risk of being laid off after the nationalisation.

In May, the government set aside 3 billion euros ($3.51 billion) of new capital to be injected into the carrier, laying out a plan for state control after the coronavirus crisis wrecked an earlier scheme to sell it to private investors.

Alitalia received 400 million euros from the government at the beginning of this year, which came on top of a bridge loan worth 900 million euros in 2017 and has not yet been paid back.

Industry Minister Stefano Patuanelli said in April that without state intervention the company would have gone bust due to the coronavirus crisis.

$1 = 0.8541 euros Reporting by Angelo Amante and Giuseppe Fonte, editing by Gavin Jones and Jane Merriman