Dolores! Alitalia is beginning to look very unloved – as opposed to just disliked – and the Italian government’s sale process is looking more and more like an old auntie’s white elephant auction.
With only one potential bidder left in the process – Gruppo Toto, the Italian construction group – the Italian government has yet again postponed the deadline for final binding offers for Alitalia to July 23, and has re-opened contacts with TPG to see if the private equity group would be willing to re-enter the bidding for Italy’s state-controlled airline, reports the FT.
But this time, TPG is playing hardball. A consortium led by TPG and including Mediobanca initially abandoned the contest in late May, and its withdrawal was followed last month by a rival consortium led by Aeroflot, which flounced out of the process complaining of inadequate information from the Italian government.
Gruppo Toto, the only bidder left standing, is bidding through its subsidiary AP Holding, which includes Air One, the small Italian carrier and other aviation sector businesses.
MatlinPatterson, the US private equity firm specialising in distressed assets, which was earlier seen as a potential independent bidder, is understood to have rejoined the TPG grouping.
TPG has told the Italian government it would only consider rejoining the contest for Alitalia if the rules of the process were changed.
Primarily, it wants the right to add other Italian investors to its consortium, to be able to hold negotiations with the Alitalia trade unions ahead of making any binding bid, and to have freedom in closing down loss-making domestic and international routes as part of any restructuring of Alitalia.
But there are undoubtedly more tensions to come. The Italian government’s renewed approach to TPG seems largely a way of securing other interest in Alitalia, should the terms of a final bid from AP prove unacceptable.