Rival airline attacks Alitalia rescue as illegal

A leading European airline group has denounced Italian plans to rescue Alitalia as illegal yesterday as shareholders were due to vote on a capital increase to keep the near-bankrupt carrier flying.

International Airlines Group (AIG), which owns British Airways and Spain's Iberia, urged the European Commission to intervene over the Italian government's attempts to stitch together a bailout for Alitalia.

A €300 million capital increase forms a major part of the rescue, which aims to keep Alitalia alive while it works out how to ensure its long-term survival, but the participation of its top investor Air France-KLM remains far from certain.

IAG said the rescue breaks European Union rules.

“We have always been opposed to state aid,” said a spokeswoman for IAG, Europe’s third biggest airline group by market value.

“It’s protectionist, undermines competition and favours failing airlines that have not got to grips with economic reality. We would urge and expect the EU Commission to take interim measures to suspend this manifestly illegal aid,” she added. – (Reuters)