Tourism Minister Edward Zammit Lewis this evening tabled the Air Malta-Alitalia Memorandum of Understanding in Parliament.
The government announced last month that it had signed a preliminary agreement with Alitalia that could see the Italian airline buy a 49% stake in Air Malta. Alitalia is itself 49% owned by UAE airline giant Etihad Airways.
The MoU was tabled as Alitalia President Luca di Montezemolo said today that the Italian airline has already started the due diligence process on Air Malta which, he said, could take up to two months.
This paper is informed, in fact, that several Alitalia and Etihad officials are currently in Malta going through Air Malta's books and studying its current business and operations model.
Last week controversy erupted after Mr Montezemolo said that if the Alitalia-Air Malta deal goes through, it would be a sub-zero-risk operation for the Italian airline. "It is an investment that would not cost a euro, and would open up interesting connections with Sicily. Let us work on it, let's carry out a management and economic due diligence," he was quoted as saying.
Tourism Minister Edward Zammit Lewis subsequently told The Malta Independent that the deal would be off if it is not advantageous to the national carrier.
Speaking in Parliament this evening, Dr Zammit Lewis said the MoU was just the first step in the long road that lay ahead. He insisted that no agreement would be signed unless this was beneficial to the Maltese airline. "If the interests of the country and of its tourism industry are not protected then there is no agreement."
Airmalta would not become a feeder airline and would remain under Maltese government control, the minister said. The government will retain its 51% shareholding and Air Malta would retain its name.
"Whilst I understand the anxiety of the employees we should not get lost in speculation. We will make the necessary announcements when we have news in hand."
The future workforce had to make sense for a restructured airline. This would also depend on the number of routes and aircraft operated by Air Malta. "I will not make sweeping statements about the employees," he said, noting that talks were underway, led by President Emeritus George Abela.
The advantages of such a partnership included Air Malta becoming part of an extensive network instead of a standalone airline and benefiting from the economies of scale, especially when it came to procurement. Another advantage would be joint purchasing, which would help improve profitability and growth, and a vision to expand the current fleet.
Dr Zammit Lewis also said the results of decisions taken in the past two years were being felt. These including the catering contract, the lease of aircraft and IT services. Practices employed today, he said, contrasted highly with what had become standard practice under previous administrations. Air Malta was leasing out two aircraft it was itself leasing, but was still losing around €1 a year.
He again denied that Air Malta would become a feeder airline, which meant that its passengers would only be flown to one airport and would have to catch connecting flights to their destination of choice.
In order for any deal to be reached there were several mandatory points laid out by the government. This included that Air Malta had to carry more tourists to Malta and a plan to expand the current fleet. Another mandatory point was that Air Malta workers have to have opportunities to further their careers with Etihad partners. The Maltese airline has to become more competitive and offer better prices, including to its Maltese customers. Frequent Maltese Air Malta customers would also have to benefit from an Etihad Airways Partners frequent flyers programme.
This news story is still being updated.
from The Malta Independent http://ift.tt/1qXGXHT
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