Alitalia’s Capital Needs Soar as Collapse Looms

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Oct. 10 (Bloomberg) -- Bloomberg’s Dan Liefgreen reports on the rising capital needs of Alitalia and their connection with the Italian government. He speaks on Bloomberg Television’s “On The Move.” (Source: Bloomberg)

They need more money.

Exactly.

It was the berlusconi government about five years ago who put together the current shareholding lineup right now with air france, the largest single investor and a group of italian entrepreneurs in the rest of the stakes.

The rest of the situation has been deteriorating over the last year.

Their projections to reach or breakeven, having been reached.

Their cash situation is worsening.

We have seen their full supplier -- fuel supplier saying, if this isn't under control, then they might not continue to supply fuel.

Clearly, prime minister letta is scrambling to find a solution.

It would not look at for him and his administration to let this go into some sort of bankruptcy.

We can't exclude that.

Alitalia's board will be meeting this evening and the government clearly wants to have a solution ready for that meeting.

So what is the likely outcome?

What are we going to hear in the next couple days?

How are they going to get this capital injection?

We heard from the prime minister that he wanted some kind of italian entity to maybe step in.

That is correct.

They are looking for a total package in funding of around half a billion euros.

About 300 million apparently is what they are thinking about in terms of the capital injection.

That is getting existing shareholders to kick in more money as well as finding a state entity or two that would provide funding as well.

The names that have come up include the state lender, the italian railways.

Thank you so much.

We will follow that closely.

Dan liefgreen.

Still with us is alain bokobza head of asset allocation.

Thank you so much for sticking around.

We were talking about the fed.

You like european equities.

You see a lot of these

This text has been automatically generated. It may not be 100% accurate.

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