Summary
- Alitalia’s aviation assets, including planes and slots, are valued at roughly -€5 million, despite being sold for €1.
- The 52 aircraft in addition to the landing slots at Rome Fiumicino absorbed by ITA Airways are considered worthless.
- Only the landing slots at Milan Linate Airport are considered significant assets, because the airport is busy and space is proscribed.
Sold to ITA Airways at a price of just €1, Alitalia’s aviation branch, including half of the planes, many of the slots, and the Alitalia databases, are actually said to be price roughly -€5 million ($5.51m) in keeping with an exclusive report published by Italian each day newspaper, Corriere della Sera on December 24.
Alitalia was sold to a brand new company, generally known as ITA Airways, in October 2021. It has since been readying for a minority stake investment from Germany’s Lufthansa because it awaits a call from the European Commission.
Sold for a euro
ITA Airways bought the Alitalia brand for €90 million and spent a single, symbolic euro on the aviation branch of the previous national carrier. The rationale for that is that the brand is price significantly more because it is a repute that the airline is purchasing. Professor Giovanni Fiori was in control of assessing and valuing Alitalia. He was also certainly one of three commissioners of a previous version of the previous national carrier generally known as Alitalia Lai, which ended up under extraordinary administration. Sarcastically, he says Alitalia must have paid ITA Airways to tackle its assets, given how little they were price. Professor Fiori told Corriere della Sera:
“The commissioners [of Alitalia] must have given ITA nearly 5 million to be rid of this a part of the business. On condition that that just isn’t allowed, the transaction was valued at 1 euro to be paid for by the commissioners.”
A valuation of -€5 million
Corriere della Sera gained access to a 44-page report from October 2021 (the date of the sale) through which the Alitalia and Alitalia Cityliner corporations were deemed price -€4.8 million. This was based on the incontrovertible fact that the aviation branch was price a negative net valuation of between €130 million and €150 million, considering the expected return over the following few years. Professor Fiori calculated this based on the next:
A part of the business |
Price |
Uniforms and spare parts |
€44.6 million |
Trademarks, domains, copyright, software, databases, and other systems |
€79.7 million |
Landing slots at Milan Linate Airport |
€125.55 million |
Emissions Trading Scheme |
€125.41 million |
Total |
€375.26 |
Based on the professor, the 52 aircraft that ITA Airways absorbed following the sale are worthless. As they’re all leased, ITA Airways needed to create its own agreements with the lessors on the aircraft, meaning they cannot be considered Alitalia assets. Moreover, the take-off and landing slots that Alitalia held at Rome’s Fiumicino Airport were also worthless, on condition that the airport was not overcrowded and had available space. Whether ITA Airways purchased Alitalia or not, it might still have been in a position to tackle slots at Rome Fiumicino.
Photo: SimoneAmi | Shutterstock.
Meanwhile, slots at Milan Linate are a few of Alitalia’s most vital assets. Milan Linate is probably the most central of the Milan Airports. The opposite two, Milan Malpensa and Milan Bergamo, are much further out. Milan Linate is busy and has little or no space, meaning without the sale, ITA Airways would have struggled to keep up a relevant standing on the airport.
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Finally, the Emissions Trading System (ETS) was also price a good sum of money. The system in keeping with the European Union. Alitalia held an agreement that lasted until 2023.
Fiori believes that over the 2 years that followed the sale (October 2021 till October 2023), the previous Alitalia assets lost the corporate roughly €380.06 million. Their net price standing at €375.26 million (as shown within the table above) signifies that the overall economic value of the aviation branch that ITA Airways absorbed amounts to -€4.8 million. Fiori adds:
“The 1 euro paid by ITA Airways shows that whoever bought the aviation a part of the Alitalia business actually created an issue, not a chance.”
Lufthansa-ITA Airways acquisition
Earlier this week, it emerged that Lufthansa’s acquisition of a 41% stake in ITA AIrways would take longer than expected to be approved by the European Commission over competition-related concerns. Brussels was expected to offer the parties a green light by January 15, 2024, nevertheless it has recently surfaced that this may occasionally take until May 2024. This was the understanding of Italian Minister of Economy Giancarlo Giorgetti, who also underlined that a call in May would mean that joint business operation between the 2 airlines this summer season becomes practically unimaginable.