Alitalia and Etihad had rejected a first proposal by the Maltese government to buy a stake in Air Malta, Times of Malta is informed.
The memorandum of understanding signed in April was the second attempt to clinch a deal.
Civil aviation industry sources told this newspaper that following talks in the second part of 2015, Alitalia had informed the Maltese government it was not interested any longer in the Maltese air carrier and had no interest in injecting any fresh capital.
“Alitalia’s board of directors made it crystal clear to the Maltese side their proposal was rejected. The Italians, supported by Etihad, said they will turn down any request involving any sort of capital injection as no cash was available,” the sources said.
The government, the sources added, had been planning to announce a deal on Air Malta by the end of 2015 and talks resumed only after it made new proposals, scaling down its demands.
Last week, the sources ex-pressed surprise at public comments made by Alitalia chairman Luca Cordero di Montezemolo when he spoke of a “zero-risk deal” and said the Italian carrier would not invest a single euro in Air Malta.
Mr Montezemolo’s comments have so far not been contradicted by the Maltese government, though Tourism Minister Edward Zammit Lewis insisted in Parliament the deal would only go through if it was beneficial to Air Malta. Confirmation that talks between Alitalia-Etihad and the Maltese government had been ongoing for some time is found in the memorandum of understanding tabled in Parliament this week.
A new attempt to find a solution was made in February
According to this document, the government, Air Malta and Alitalia had signed a confidentiality and non-disclosure agreement on October 21, 2015, covering both the information disclosed by the Maltese carrier to Alitalia (including due diligence information and materials) and those disclosed by the Italian airline to Air Malta (including a business plan and reports by external consultants).
Last December 20, Prime Minister Joseph Muscat clearly indicated a deal on the partial privatisation of Air Malta was very close when he said that the government was about to make a decision about the airline on the same model adopted for Enemalta.
Government sources said following Alitalia’s rejection of the proposals last December, no talks took place between the two sides for a number of weeks. However, a new attempt to find a solution was made in February leading to the memorandum of understanding.
Both Alitalia-Etihad and the Maltese government have agreed to try to wrap-up the talks and sign an agreement by the end of July. The industry sources said the two sides had already agreed on a number of outstanding issues, including the staff complement and the outsourcing of non-core operations.
It is envisaged that none of the airline employees will end up jobless, as they will be absorbed by a new government company, similar to what happened to Enemalta employees.
ivan.camilleri@timesofmalta.com