The European Commission on Wednesday approved an Italian bailout of Alitalia and said the airline's new owners would not have to repay an illegal government loan, clearing a major hurdle in a deal to revive the carrier.
But Alitalia employees opposed to the CAI investor group's 375 million euro ($473.4 million) take-over - which is contingent on EU approval - continued protests against the deal for a third day, forcing the cancellation of 50 flights.
The Commission determined a 300 million euro loan to the airline in April was illegal state aid, but the EU transport commissioner said the obligation to repay it would rest with Alitalia's assets languishing under bankruptcy rather than CAI. "The debts have to be paid back by the old Alitalia," EU Transport Commissioner Antonio Tajani, a former aide to Italian Prime Minister Silvio Berlusconi, told a news conference.
CAI was keen to avoid having to repay the loan, and Italy's government had sought to ensure that CAI was protected, by stating that any repayment obligation should be tied to those Alitalia assets not being acquired by the investor group.
The Commission said Alitalia's operations must be sold to CAI - the only bidder in the airline's third attempt at selling itself - at market price, to ensure creditors get their money back. Alitalia filed for bankruptcy in August after two failed attempts to find a buyer, weighed down by high labour costs, frequent strikes, rising oil prices and mismanagement.
CAI's offer - which allows it to cherry-pick Alitalia's best assets, while leaving the rest to the Italian state - must also be approved by Alitalia's bankruptcy commissioner. He has hired two independent advisers to value the airline's assets. CAI offered 275 million euros for Alitalia's core flight operations, 100 million euros in a mix of cash and debt for its various units, and will take on debt worth 625 million euros.