Merger With Alitalia: Etihad to invest $750m for 49% shares

Etihad is expected to invest €560 million ($750 million) to become the main stakeholder in the Italian airline

BRUSSELS: The European Commission approved a deal that will see Etihad Airways take a 49-per cent stake in Alitalia, effectively rescuing the struggling Italian company.

Brussels gave the merger the go-ahead under the condition that the airlines opened up the Rome-Belgrade route to competitors.

Etihad, based in Abu Dhabi, is expected to invest €560 million ($750 million) to become the main stakeholder in the Italian airline.

Key stumbling blocks in the drawn-out merger negotiations were Alitalia’s debt of about 1.0 billion euros and overstaffing issues.

Etihad has expanded hugely since it was founded in 2003 and now has stakes in India’s Jet Airways, Air Serbia, Air Seychelles, Aer Lingus and Air Berlin.

Published in The Express Tribune, November 16^th, 2014.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.