Australian company interested in Air Malta subsidiary

An Australian venture capital company is reportedly showing active interest in acquiring Air Malta's financially troubled subsidiary, AZZURRAair.

The weekly aviation magazine, Flight International, said the company, Integrated Airline Solutions (IAS), has embarked on a due diligence exercise of the Bergamo-based company in the hope that it can acquire the regional carrier and transform it into a low-fare operator.

Air Malta, which has a 49 per cent stake in AZZURRAair, yesterday preferred not to make any statements on the issue at this stage.

IAS director Angus Clarke told Flight International talks were at a preliminary stage. He said the vision was to put in equity and make it a real low-cost competitor to Alitalia.

Flight International said that, on taking over AZZURRAair, IAS planned to dispose of the four BAe Systems Avro RJ70s and three Avro RJ85s airliners, currently on lease from Air Malta, and would instead operate an all-Boeing 737 fleet. AZZURRAair at present has five B737-700s.

AZZURRAair is among 11 airlines worldwide that still operate the RJ family of regional airliners.

Mr Clarke told the aviation magazine AZZURRAair's owners wanted to sell the airline. AZZURRAair, he added, was also in need of capital injection.

Flight International said IAS had earlier attempted to take over the Greek national carrier, Olympic Airways, which is also in the red, but funding issues led to the bid's collapse.